Argon Manufacturing Company processes direct materials up to the splitoff point where two products (U and V) are obtained and sold. The following information was collected for last quarter of the calendar year:

Direct materials processed: 10,000 gallons (note: processing results in some shrinkage of material )

Production:	Product U	4200 gallons
	Product V	4100 gallons
Sales price:	Product U	$150.00 per gallon
	Product V	$100.00 per gallon

The cost of purchasing 10,000 gallons of direct materials and processing it up to the splitoff point was $975,000.

How much of the $975,000 of joint costs are allocated to product U using the physical quantity method?

Selected Answer:	497,250
Correct Answer:	493,373.49

Argon Manufacturing Company processes direct materials up to the splitoff point where two products (U and V) are obtained and sold. The following information was collected for last quarter of the calendar year: Direct materials processed: 10,000 gallons (note: processing results in some shrinkage of material ) The cost of purchasing 10,000 gallons of direct materials and processing it up to the splitoff point was $975,000. How much of the $975,000 of joint costs are allocated to product U using the physical quantity method