Answer the Following Questions Using the Information Below:
the Alfarm

Answer the following questions using the information below:
The Alfarm Corporation processes raw milk up to the splitoff point where two products, cream and liquid skim, are produced and sold. There was no beginning inventory. The following material was collected for the month of February:
$\begin{array}{lll}\text { Direct materials processed: } && 750,000 \text { gallons }(727,500 \text { gallons of good product) } \\\text { Production: } & \text { Cream } & 442,500 \text { gallons } \\& \text { Liquid skim } & 285,000 \text { gallons } \\\text { Sales: } & \text { Cream } & 421,500 \text { at } \$ 110 \text { per gallon } \\& \text { Liquid skm } & 273,000 \text { at } \$ 100 \text { per gallon }\end{array}$ The cost of purchasing 750,000 gallons of direct materials and processing it up to the splitoff point to yield a total of 727,500 gallons of good product was $2,280,000.
-What are the physical-volume proportions to allocate joint costs for cream and liquid skim,respectively?

A) 59.00% and 41.00%
B) 60.82% and 39.18%
C) 50.00% and 50.00%
D) 59.79% and 40.21%

Correct Answer:

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