Allocating Joint Costs Using the Physical Units Method

to be pureed for use in sauces are of lower grade than peaches for slices, yet still food grade for canning. Information on a recent purchase of $23,000$ pounds of peaches is as follows:

Required:

Note: Round percentages to a whole decimal and use in subsequent computations. $($i$.$e$.,0\mathrm{.}07625=8\%).$ Enter joint cost allocation amounts to the nearest cent.

Allocate the joint cost to the four grades of peaches using the physical units method.

Allocate the joint cost to the four grades of peaches by finding the average joint cost per pound and multiplying it by the number of pounds in the grade.

Note: Round the average cost answer to the nearest cent and use rounded amount in subsequent computations.

per pound.

Joint Cost

Grades Allocation