Quality?, Inc. is a producer of potato chips. A single production process at Quality?, ?Inc.,...
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Accounting
Quality?, Inc. is a producer of potato chips. A single production process at Quality?, ?Inc., yields potato chips as the main product and a byproduct that can also be sold as a snack. Both products are fully processed by the splitoff? point, and there are no separable costs. For September 2014?, the cost of operations is $ 525 comma 000. Production and sales data are as? follows:
Production (in pounds)
Sales (in pounds)
Selling Price per Pound
Main Product:
Potato Chips
42,000
32,760
$26
Byproduct
8,400
7,500
$5
There were no beginning inventories on September? 1,
20142014.
Requirements
1.
What is the gross margin for
QualityQuality?,
?Inc., under the production method and the sales method of byproduct?accounting?
2.
What are the inventory costs reported in the balance sheet on September? 30,
20142014?,
for the main product and byproduct under the two methods of byproduct accounting in requirement? 1?
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