Question

Wren Pork Company uses the relative market value method/Value basis method of allocating joint costs in its production of pork products. Relevant information for the current period follows:

Product Pounds Price/lb.
Loin chops 3,080 $5.40
Ground 10,200 2.20
Ribs 4,120 5.05
Bacon 6,160 3.70
The total joint cost for the current period was $45,400. How much of this cost should Wren Pork allocate to Loin chops?
A. $0.
B. $6,443.
C. $9,134.
D. $11,350.
E. $45,400.

Answer 1

C. $9,134

Step-by-step explanation:

Product Pounds Price/Ib Total Value

Loin chops 3,080 $5.40 $16,632

Ground 10,200 $2.20 $22,440

Ribs 4,120 $5.05 $20,806

Bacon 6,160 $3.70 $22,792

$82,670

The Total Joint cost = $45,400

Hence Joint cost to Lopin chops = $45,400 * $16,632 / $82,670

Joint cost to Lopin chops = $9,134