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Oregon Lumber Ending Inventory

Oregon Lumber processes timber into four products. During January, the joint costs of processing were $280,000. There was no inventory at the beginning of the month. Production and sales value information for the month is as follows:

Sales Value at

Product
Board feet
Splitoff Point
Ending Inventory

2 x 4's
6,000,000
$0.30 per board foot
500,000 bdft.

2 x 6's
3,000,000
0.40 per board foot
250,000 bdft.

4 x 4's
2,000,000
0.45 per board foot
100,000 bdft.

Slabs
1,000,000
0.10 per board foot
50,000 bdft.

Question: Determine the value of ending inventory if the sales value at splitoff method is used for product costing. Round to 3 decimal places when necessary.

Solution Preview

Total Board feet produced = 12,000,000
Total Processing Cost = $280,000

Board Feet ...

Solution Summary

The solution does a great job of answering the question. The solution is very easy to follow along and can be understood by anyone with a basic understanding of the subject. Overall, an excellent response to the questions being asked.

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