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Atlas Foods produces the following three supplemental food products simultaneously through a refining process costing $93,000. Alfa: 10,000 pounds of Alfa, a popular but relatively rare grain supplement having a caloric value of 4,400 calories per pound. Betters: 5,000 pounds of Betters, a flavoring material high in carbohydrates with a caloric value of 11,200 calories per pound. Morefeed: 1,000 pounds of Morefeed, used as a cattle feed supplement with a caloric value of 1,000 calories per pound. The joint products, Alfa and Betters, have a final selling price of $4 per pound and $10 per pound, respectively, after additional processing costs of $2 per pound of each product are incurred after the split-off point. Morefeed, a by-product, is sold at the split-off point for $3 per pound. Assuming Atlas Foods inventories Morefeed, the by-product, the joint cost to be allocated to Alfa using the net realizable value method is
A. $30,000. B. $31,000. C. $60,000. D. $3,000.
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