Question - Jim Davis Company processes pork into three products- chops, bacon, and sausage. Production and selling price data follow: Chops 100,000 lbs. $5.00/lb. Bacon 210,000 lbs. $4.00/lb. Sausage 410,000 lbs. $2.00/lb.
Pork is processed in the Processing Department. From the split-off point, bacon is smoked, sliced, and packaged in the Bacon Department.
The cost incurred for these processes was $100,000. In addition, sausage was ground and formed into patties in the Sausage Department after the split-off. This process cost $60,000.
a. If joint processing costs were $1,500,000, calculate the total cost of each product using the adjusted sales value method.
b. Prepare the journal entries to (1) record the joint processing and movement of product out of the Processing Department after the split off, and (2) record the additional processing and completion of the bacon and sausage.