The Southern Oil Company buys crude vegetable oil. Refining this oil results in four products at the split-off point: A, B, C, and D. Product C is fully processed by the split-off point. Products A, B, and D can be further refined into Super A, Super B, and Super D. In the most recent month (December), the output at the split-off point was as follows:
- Product A: 322,400 gallons
- Product B: 119,600 gallons
- Product C: 52,000 gallons
- Product D: 26,000 gallons
The joint costs of purchasing and processing the crude vegetable oil were $96,000. Southern has no beginning or ending inventories. Sales of product C in December were $24,000. Products A, B, and D were further refined and then sold. Data related to December are as follows:
|
Separable Processing Costs to Make Super Products
|
Revenue
|
|
Super A
|
$249,600
|
$300,000
|
|
Super B
|
102,400
|
160,000
|
|
Super D
|
152,000
|
160,000
|
Southern had the option of selling products A, B, and D at the split-off point. This alternative would have yielded the following revenues for the December production:
- Product A: $84,000
- Product B: $72,000
- Product D: $60,000
Assume Southern uses the physical units method (quantity in gallons) to allocate joint costs to products. Calculate the joint cost allocated to Product C. Do not use decimals in your answer.