Exercise $4-12$B Allocating joint product cost

Underwood Food Corporation makes two products from soybeans: cooking oil and cattle feed. From a

standard batch of $100,000$ pounds of soybeans, Underwood produces $20,000$ pounds of cooking oil and

$80,000$ pounds of cattle feed. Producing a standard batch costs $$27,000.$ The sales prices per pound are

$$3\mathrm{.}00$ for cooking oil and $$1\mathrm{.}50$ for cattle feed.

Required

a$.$ Allocate the joint product cost to the two products using weight as the allocation base.

b$.$ Allocate the joint product cost to the two products using market value as the allocation base.