ACCT $254$

Joint Cost Allocation Assignment

Vanguard Company makes three products, M$,$ N$,$ and P$,$ which come from a joint process. The joint costs for each batch of the products are: $$80,000$ for direct materials, $$40,000$ for direct labor, and $$30,000$ for indirect costs $($overhead$).$ Each batch produces $10,000$ pounds of product M with a market value of $$6$ per pound; $5,000$ pounds of N with a market value of $$12$ per pound; and $9,000$ pounds of P with a market value of $$10$ per pound.

Required:

Determine the total amount of joint cost allocated to each of the products, assuming that the allocation is based on the weight of products produced.

Determine the total amount of joint cost allocated to each of the products, assuming that the allocation is based on the market value of the products.