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The Modian Company processes unprocessed goat milk up to the split-off point where two products,...

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Accounting

The Modian Company processes unprocessed goat milk up to the split-off 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: 111,200 gallons (after shrinkage)

Production: Condensed goat milk 45,500 gallons

Skim goat milk 58,500 gallons

Sales: Condensed goat milk $5.00 per gallon

Skim goat milk $4.50 per gallon

The costs of purchasing the unprocessed goat milk and processing it up to the split-off point to yield a total of 111,200 gallons of saleable product was $186,220. There were no inventory balances of either product. Condensed goat milk may be processed further to yield 45,046 gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of $5 per usable gallon. Xyla can be sold for $18 per gallon.

Skim goat milk can be processed further to yield 57,178 gallons of skim goat ice cream, for an additional processing cost per usable gallon of $5. The product can be sold for $10 per gallon.

There are no beginning and ending inventory balances.

Using estimated net realizable value, what amount of the joint costs would be allocated to Xyla?

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