Georgette Rheingold owns and operates a fruit smoothie manufacturing operation, Nutri-smoothie. She processes fruit and adds it to yogurt and produces fruit smoothies, the main product. She sells the rinds and other waste to a recycling organization that turns the waste into compost. Neither product requires processing after the split-off point. Information for last month’s operations follows:
Joint costs of smoothie production ………………………$12,000
Smoothie production (in ½ L bottles) …………………….20,000
Price per bottle ………………………………………………..$2
Sales last month (bottles) …………………………………18,000
Compost production …………………………………..10,000 kg
Compost sales …………………………………………..8,000 kg
Compost revenue …………………………………………$2,000
REQUIRED
A. What is Nutri-smoothie’s gross margin for last month if the by-product value is recognized at the time of production?
B. What is Nutri-smoothie’s gross margin for last month if the by-product value is recognized at the time of sale?
C. Calculate the inventory value for both smoothies and compost on the under the methods used in Parts A and B.
Enjoy 24/7 customer support for any queries or concerns you have.
Phone: +1 213 3772458
Email: support@gradeessays.com