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The Green Company processes unprocessed goat milk up to the splitoff point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October:

Direct Materials processed:98,000 gallons (after shrinkage)

Production:Condensed goat milk42,500 gallons

Skim goat milk55,500 gallons

Sales:Condensed goat milk$3.50 per gallon

Skim goat milk$2.50 per gallon

The costs of purchasing the of unprocessed goat milk and processing it up to the splitoff point to yield a total of 98,000 gallons of saleable product was $184,480. There were no inventory balances of either product.

Condensed goat milk may be processed further to yield 42,000 gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of $4 per usable gallon. Xyla can be sold for $20 per gallon.

Skim goat milk can be processed further to yield 54,200 gallons of skim goat ice cream, for an additional processing cost per usable gallon of $4. The product can be sold for $9 per gallon.

There are no beginning and ending inventory balances.

Requirements: 1. Using estimated net realizable value, what amount of the joint costs would be allocated Xyla and the skim goat ice cream?

2. Using the sales value at splitoff method, what is the gross-margin percentage for condensed goat milk and skim goat milk at the splitoff point?

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