Tasty, Inc., is a producer of potato chips. A single production process at Tasty, Inc., yields potato chips as the main product and a byproduct that can also be sold as snack. Both products are fully processed by the splitoff point, and there are no separable costs. For September 2022, the cost of operation is $300,000. Production and sales data are as follows: Main Product: Potato Chips Byproduct Production (in pounds) Sales (in pounds) 80,000 8,000 Main products: Byproducts: 72,000 6,000 There were no beginning inventories on September 1, 2022. What are the inventory costs reported in the balance sheet on September 30, 2022, for the main product and byproduct under the production method and the sales method of byproduct accounting? Selling Price per Pound $20 $5 The production method The sales method
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- Accounting for a main product and a byproduct (Cheatham and green, adapted)Crispy,Inc., is a producer of potato chips. A single production process at crispy, Inc., yields potato chips as the main product, as well as byproduct that can be sold as a snack. Both products are fully processed by the splitoff point, and there are no separable costs. For September 2017, the cost of operations is $520,000. Production and sales data are as follows:Yum, Inc. is a producer of potato chips. A single production process at Yum, Inc., yields potato chips as the main product, as well as a byproduct that can be sold as a snack. Both products are fully processed by the splitoff point, and there are no separable costs. For September 2020, the cost of operations is $485,000. Production and sales data are as follows: Note: There were no beginning inventories on September 1, 2020. Requirements Dialog content starts 1. What is the gross margin forbYum,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, 2020, for the main product and byproduct under the two methods of byproduct accounting in requirement 1? 3. Prepare the journal entries to record the byproduct activities under (a) the production method and (b) the sales method. Briefly discuss the effects on the financial statements.Holy Cow is a producer of milk and byproducts. A single production process at Holy Cow yields milk as the main product, as well as ghee, a byproduct of milk production, that can be sold. Both products are fully processed by the splitoff point, and there are no separable costs. For the month of October 2020, the cost of operations is $380,000. Production and sales data are as follows: (Click the icon to view the production and sales data.) There were no beginning inventories on October 1, 2020. Read the requirements. Requirements 1. What is the gross margin for Holy Cow under the production method and the sales method of byproduct accounting? 2. What are the inventory costs reported in the balance sheet on October 31, 2020, for the main product and byproduct under the two methods of byproduct accounting in requirement 1? Print - X Done Data table Milk Ghee, byproduct Production (in gallons) 540,000 12,000 Print Sales (in gallons) Selling Price per Gallon 523,800 $ 11,400 $ Done 0.80…
- Crispy, Inc. is a producer of potato chips. A single production process at Crispy, Inc., yields potato chips as the main product, as well as a byproduct that can be sold as a snack. Both products are fully processed by the splitoff point, and there are no separable costs. For September 2020, the cost of operations is $520,000. Production and sales data are as follows: (Click the icon to view the production and sales data.) Data table Potato Chips Byproduct Production (in pounds) Sales (in pounds) 46,000 8,200 Deduct value of byproduct production Print 34,960 $ 5,000 $ Done Selling Price per pound 26 5 X There were no beginning inventories on September 1, 2020. Read the requirements. Requirements 1. What is the gross margin for Crispy, 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, 2020, for the main product and byproduct under the two methods of byproduct accounting in…Germano Products, Incorporated, has a Pump Division that manufactures and sells a number of products, including a standard pump that could be used by another division in the company, the Pool Products Division, in one of its products. Data concerning that pump appear below: Capacity in units 72,500 Selling price to outside customers $ 79 Variable cost per unit $ 28 Fixed cost per unit (based on capacity) $ 32 The Pool Products Division is currently purchasing 17,000 of these pumps per year from an overseas supplier at a cost of $74 per pump. Assume that the Pump Division is selling all of the pumps it can produce to outside customers. Does there exist a transfer price that would make both the Pump and Pool Products Division financially better off than if the Pool Products Division were to continue buying its pumps from the outside supplier?Data table Milk Ghee, byproduct Production (in gallons) 580,000 13,000 Sales (in gallons) Selling Price per Gallon 556,800 $ 12,350 $ 1.00 0.60
- Accounting for a main product and a byproduct. (Cheatham and Green, adapted) Crispy, Inc., is a producer of potato chips. A single production process at Crispy, Inc., yields potato chips as the main product, as well as a byproduct that can be sold as a snack. Both products are fully processed by the splitoff point, and there are no separable costs. For September 2017, the cost of operations is $520,000. Production and sales data are as follows: Production (lbs) Sales (lbs) Sell price per lb Potato Chips 46,000 34,960 $26 Byproducts 8200 5000 $5 There were no beginning inventories on September 1, 2017. What is the gross margin for Crispy, Inc., under the production method and the sales method of byproduct accounting? What are the inventory…Quest Motors, Inc., operates as a decentralized multidivision company. The Vivo division of Quest Motors purchases most of its airbags from the airbag division. The airbag division’s incremental cost for manufacturing the airbags is $90 per unit. The airbag division is currently working at 80% of capacity. The current market price of the airbags is $125 per unit. Q. Using the general guideline presented in the chapter, what is the minimum price at which the airbag division would sell airbags to the Vivo division?SEved Spring Corp. has two divisions, Daffodil and Tulip. Daffodil produces a gadget that Tulip could use in its production. Tulip currently purchases 170,000 gadgets for $13.90 on the open market. Daffodil's variable costs are $7 per widget while the full cost is $11.45. Daffodil sells gadgets for $14.40 each. If Daffodil is operating at capacity, what would be the minimum transfer price Daffodil would accept for an internal transfer? Multinic Choice $7.40 $1.45 $13.90 $14.40
- Zumsteg Products, Incorporated, has a Pump Division that manufactures and sells a number of products, including a standard pump. Date concerning that pump appear below: Capacity in units Selling price to outside customers Variable cost per unit Fixed cost per unit (based on capacity) 72,800 #106 70.0 $20 The company has a Pool Products Division that could use this pump in one of its products. The Pool Products Division is currently purchasing 8,800 of these pumps per year from an overseas supplier at a cost of $99 per pump. Required: Assume that the Pump Division has enough Idle capacity to handle all of the Pool Products Division's needs. What is the acceptable ange, If any, for the transfer price between the two divisions? Note: Round your answers to 1 decimal place.Wetherald Products, Incorporated, has a Pump Division that manufactures and sells a number of products, including a standard pump that could be used by another division in the company, the Pool Products Division, in one of its products. Data concerning that pump appear below: Capacity in units 55,000 Selling price to outside customers $ 82 Variable cost per unit $53 Fixed cost per unit (based on capacity) $11 The Pool Products Division is currently purchasing 4,000 of these pumps per year from an overseas supplier at a cost of $74 per pump. Assume that the Pump Division has enough idle capacity to handle all of the Pool Products Division's needs. What should be the minimum acceptable transfer price for the pumps from the standpoint of the Pump Division? Multiple Choice $74 per unit $53 per unit $64 per unit $82 per unitQuest Motors, Inc., operates as a decentralized multidivision company. The Vivo division of Quest Motors purchases most of its airbags from the airbag division. The airbag division’s incremental cost for manufacturing the airbags is $90 per unit. The airbag division is currently working at 80% of capacity. The current market price of the airbags is $125 per unit. Q. Suppose that Quest Motors requires that whenever divisions with unused capacity sell products internally, they must do so at the incremental cost. Evaluate this transfer-pricing policy using the criteria of goal congruence, evaluating division performance, motivating management effort, and preserving division autonomy