Question

Florissa's Flowers jointly produces three varieties of flowers in the same garden: tulips, lilies, and daisies. The flowers are all watered via the same irrigation system and all receive the same amount of water; daisies require three times as much as lilies, and the water required for tulips is about halfway between the amounts needed for daisies and lilies. Although the lilies and tulips receive more water than they need due to the joint irrigation process, they are not hurt by the overwatering. The joint production cost of the three varieties of flowers is about $30 per harvest. Every harvest yields 10 tulips, 20 lilies, and 20 daisies

Allocate the joint costs of production to each product using the physical units method.

Joint Product Flowers per Harvest Proportion Joint Costs Allocation
Tulip % $ $
Lily %
Daisy %
Totals $

Which products receive the largest portion of the joint costs?

Answer 1

Lily and Daisy

Step-by-step explanation:

Joint product Flowers per harvest Proportion Joint cost allocation

Tulip 10 20% (10/50) $6 ($30*20%)

Lily 20 40% (20/50) $12 ($30*40%)

Daisy 20 40% (20/50) $12 ($30*40%)

Totals 50 100% $30

As per above results, both Lily and Daisy received the largest proportion of joint cost.