# Answered Essay: Sunshine Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point.​ A, B,​ C, and D. Pro

Sunshine Oil Company buys crude vegetable oil. Refining this oil results in four products at the splitoff point.​ A, B,​ C, and D. Product C is fully processed by the splitoff point. Products​ A, B, and D can individually be further refined into Super​ A, Super​ B, and Super D. In the most recent month​ (December), the output at the splitoff point was as​ follows:

Product​ A,

322 comma 400

 gallons times

Product​ B,

119 comma 600

 gallons times

Product​ C,

52 comma 000

 gallons times

Product​ D,

26 comma 000

 gallons

The joint costs of purchasing and processing the crude vegetable oil were

\$ 96 comma 000

.

Sunshine

had no beginning or ending inventories. Sales of product C in December were

\$ 24 comma 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 Revenues Super A \$249,600 \$320,000 Super B 102,400 160,000 Super D 152,000 160,000

Sunshine

had the option of selling products​ A, B, and D at the splitoff point. This alternative would have yielded the following revenues for the December​ production:

 times

Product​ A, \$ 84 comma 000

 times

Product​ B, \$ 72 comma 000

 times

Product​ D, \$ 60 comma 000

Requirements

Compute the​ gross-margin percentage for each product sold in​ December, using the following methods for allocating the

\$ 96 comma 000

joint​ costs:
 a. Sales value at splitoff b. ​Physical-measure c. NRV
2. CouldSunshine
 have increased its December operating income by making different decisions about the further processing of products​ A, B, or​ D? Show the effect on operating income of any changes you recommend.

 Answer 1. Allocation of Joint Cost Under Sales Value at Split off Product Sales Value at Split off Joint Cost Allocated (Sales Value / Total Sales Value) X \$96,000) A 84,000 33,600 B 72,000 28,800 C 24,000 9,600 D 60,000 24,000 Total 240,000 96,000 Allocation of Joint Cost Under Physical Method Product Physical Output in gallons Joint Cost Allocated (Physical Output / Total Physical Output) X \$96,000) A 322,400 59,520 B 119,600 22,080 C 52,000 9,600 D 26,000 4,800 Total 520,000 96,000 Allocation of Joint Cost Under NRV Method Product Sales Revenue After further processing Sales Revenue at the point of split off Further Processing Costs Net Realizable Value Joint Cost Allocated Super A 320,000 – 249,600 70,400 42,240 Super B 160,000 – 102,400 57,600 34,560 C – 24,000 – 24,000 14,400 Super D 160,000 – 152,000 8,000 4,800 Total 640,000 24,000 504,000 160,000 96,000
 Answer 2. Product A B D Sales Revenue After further Processing 320,000 160,000 160,000 Sales Revenue At the point of split off 84,000 72,000 60,000 Incremental Sales revenue 236,000 88,000 100,000 Further Processing Costs 249,600 102,400 152,000 Profit (Loss) arising due to further processing (13,600) (14,400) (52,000) Sunshine should not further process any product as it will decrease the operating profit as shown above
Pages (550 words)
Approximate price: -

Help Me Write My Essay - Reasons:

Best Online Essay Writing Service

We strive to give our customers the best online essay writing experience. We Make sure essays are submitted on time and all the instructions are followed.

Our Writers are Experienced and Professional

Our essay writing service is founded on professional writers who are on stand by to help you any time.

Free Revision Fo all Essays

Sometimes you may require our writers to add on a point to make your essay as customised as possible, we will give you unlimited times to do this. And we will do it for free.

Timely Essay(s)

We understand the frustrations that comes with late essays and our writers are extra careful to not violate this term. Our support team is always engauging our writers to help you have your essay ahead of time.

Customised Essays &100% Confidential

Our Online writing Service has zero torelance for plagiarised papers. We have plagiarism checking tool that generate plagiarism reports just to make sure you are satisfied.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

HOW OUR ONLINE ESSAY WRITING SERVICE WORKS

Let us write that nagging essay.

By clicking on the "PLACE ORDER" button, tell us your requires. Be precise for an accurate customised essay. You may also upload any reading materials where applicable.

Pick A & Writer

Our ordering form will provide you with a list of writers and their feedbacks. At step 2, its time select a writer. Our online agents are on stand by to help you just in case.

Editing (OUR PART)

At this stage, our editor will go through your essay and make sure your writer did meet all the instructions.