Asked by

Carlin Davis
on Dec 17, 2024

verifed

Verified

McBride's Dairy has 200 gallons of cream and 600 gallons of skimmed milk and has incurred $1,000 of joint costs at the split-off point. It also incorporates a processing time weight factor of 1 for the cream and 3 for the skimmed milk. The amount of this cost that will be allocated to cream using the weighted average method is

A) $1,000
B) $900
C) $100
D) $250

Weighted Average Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the weighted average cost of all items available for sale during the period.

Joint Costs

The costs incurred in the process of producing two or more joint products before the point at which the products become separately identifiable.

Split-Off Point

In a production process, the stage at which jointly processed products become individually identifiable and able to be separated into distinct products.

  • Understand and apply different methods for joint cost allocation.
verifed

Verified Answer

SP
Samantha PlumleeDec 21, 2024
Final Answer:
Get Full Answer