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Comparison of alternative joint-cost-allocation methods, further-processing decision, chocolate products. The Rich and Creamy Edibles Factory manufactures and distributes chocolate products. It purchases cocoa beans and processes them into two intermediate products: chocolate-powder liquor base and milk-chocolate liquor base. These two intermediate products become separately identifiable at a single splitoff point. Every 600 pounds of cocoa beans yields 20 gallons of chocolate-powder liquor base and 60 gallons of milk-chocolate liquor base. The chocolate-powder liquor base is further processed into chocolate powder. Every 20 gallons of chocolate-powder liquor base yield 680 pounds of chocolate powder. The milk-chocolate liquor base is further processed into milk chocolate. Every 60 gallons of milk-chocolate liquor base yield 1,100 pounds of milk chocolate. Production and sales data for August 2017 are as follows (assume no beginning inventory): ■ Cocoa beans processed, 27,600 pounds ■ Costs of processing cocoa beans to splitoff point (including purchase of beans), $70,000

Comparison of alternative joint-cost-allocation methods, further-processing decision, chocolate products. The Rich and Creamy Edibles Factory manufactures and distributes chocolate products. It purchases cocoa beans and processes them into two intermediate products: chocolate-powder liquor base and milk-chocolate liquor base. These two intermediate products become separately identifiable at a single splitoff point. Every 600 pounds of cocoa beans yields 20 gallons of chocolate-powder liquor base and 60 gallons of milk-chocolate liquor base. The chocolate-powder liquor base is further processed into chocolate powder. Every 20 gallons of chocolate-powder liquor base yield 680 pounds of chocolate powder. The milk-chocolate liquor base is further processed into milk chocolate. Every 60 gallons of milk-chocolate liquor base yield 1,100 pounds of milk chocolate. Production and sales data for August 2017 are as follows (assume no beginning inventory):

■ Cocoa beans processed, 27,600 pounds

■ Costs of processing cocoa beans to splitoff point (including purchase of beans), $70,000

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