Question

Tanner Corporation produced 4,270 units, consisting of three separate products, in a joint process for the year. The market for these products was so unstable that it was not practical to estimate the selling price of the products. A cost of $471,000 was incurred in the joint process. Product X's production was 80% of product Y's while product Z's production was 125% of product Y's. What is the amount of the joint cost allocable to product X (rounded to the nearest whole dollar) assuming Tanner uses the physical quantities method of allocation?

Answer 1

Lets product Y production is equal to 100%

Then Product X = 100*80% = 80%

Product Z = 100*125% = 125%

Product	Percentage	Physical Unit	Joint Cost	Joint cost
X	80%	4270*80/305 = 1120	471000	471000*1120/4270 = 123541
Y	100%	1400	471000	154426
Z	125%	1750	471000	193033
Total	305%	4270		471000

So answer is $123541