Purchase Solution

West Chemical, Joint Costs, allocate physical units NRV

Not what you're looking for?

Ask Custom Question

West Chemical, Joint Costs, allocate physical units NRV

West Chemical manufactures Pentex and Glaxco - two industrial chemicals - in a joint process. In October, 16,000 pounds of Pentex and 4,000 pounds of Glaxco were processed. Management generally processes each of these chemicals further in separable processes to manufacture more refined products. Pentex is processed separately at a cost of $120,000, with the resulting product selling for $45 per pound. Glaxco is processed separately at a cost of $40,000, and the resulting product sells for $100 per pound.

Required:

1. Assuming that total joint production costs amounted to $500,000, allocate these costs by using:

a. The physical-units method.
b. The net-realizable-value method.

2. What revenue or expense amounts are necessary to make a sell-or-process-further decision and why?

3.When allocating joint costs, what is the meaning of death spiral?

Purchase this Solution

Solution Summary

Your guidance is attached in excel. Click in cells to see details. Instructional notes are on the spreadsheet for you.

Solution Preview

Your guidance is attached in excel. Click in cells to see details. Instructional notes are on the spreadsheet for you.

What revenue or expense amounts are necessary to make a sell-or-process-further decision and why?

You need ...

Solution provided by:
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
Recent Feedback
  • "hey just wanted to know if you used 0% for the risk free rate and if you didn't if you could adjust it please and thank you "
  • "Thank, this is more clear to me now."
  • "Awesome job! "
  • "ty"
  • "Great Analysis, thank you so much"
Purchase this Solution


Free BrainMass Quizzes
Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

Paradigms and Frameworks of Management Research

This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.