Question - Ron Chemicals produces four products from a joint process costing $450,000 per month. After leaving the joint process, the products must be further refined before they are salable. You have been provided with the following information:
Product Volume Further Processing Costs Selling Price per Unit
A-1 25,000 $350,000 $65
B-3 15,000 400,000 82
C-2 20,000 100,000 35
Q-9 60,000 250,000 20
Required: Allocate the joint costs using the physical unit's method.
1. Physical Units Method
2. Net Realizable Value Method