-..Required informationExhibit 13-7 Santa Maria Wool Cooperative236,000Cost of wool6.Cost of separation process40,000Sales value of intermediate products at split-off point:8Undyed coarse wool125,0009.Undyed fine wool156,00010Undyed superfine wool60,00011 Costs of further processing (dyeing) intermediate products:12Undyed coarse wool50,00013Undyed fine wool60,00014Undyed superfine wool10,00015 Sales value of end products:16Dyed coarse wool170,00017Dyed fine wool207,00018Dyed superfine wool98,000< Prev曲Next >of 3.... . .DELL%24%24%24%24%24%24%24%24%24%24%244- Required informationa. What is the overall profit if all intermediate products are processed into final products?Overall profit from processing all intermediateproductsb. What is the financial advantage (disadvantage) from further processing?from further processing undyed coarse woolfrom further processing undyed fine woolfrom further processing undyed superfine wool< Prev2of 3Next >.... ......I..... .........DOLL

The cost of preparing joint goods for further usage or trade after the manufacturing process's…

4 Exhibit 13-7 Santa Maria Wool Cooperative 236,000 Cost of wool 40,000 Cost of separation process Sales value of intermediate products at split-off point: 2$ 125,000 8 Undyed coarse wool 2$ 156,000 9. Undyed fine wool 2$ 60,000 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products: 24 50,000 12 Undyed coarse wool $ 60,000 13 Undyed fine wool $ 10,000 14 Undyed superfine wool 15 Sales value of end products: 16 Dyed coarse wool 170,000 17 Dyed fine wool 2$ 207,000 18 Dyed superfine wool 98,000 < Prev of 3 Next ........*.... ............. %24 %24 %24 2.

4 Exhibit 13-7 Santa Maria Wool Cooperative 236,000 Cost of wool 40,000 Cost of separation process Sales value of intermediate products at split-off point: 2$ 125,000 8 Undyed coarse wool 2$ 156,000 9. Undyed fine wool 2$ 60,000 10 Undyed superfine wool 11 Costs of further processing (dyeing) intermediate products: 24 50,000 12 Undyed coarse wool $ 60,000 13 Undyed fine wool $ 10,000 14 Undyed superfine wool 15 Sales value of end products: 16 Dyed coarse wool 170,000 17 Dyed fine wool 2$ 207,000 18 Dyed superfine wool 98,000 < Prev of 3 Next ........*.... ............. %24 %24 %24 2.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In Department C of Samantha Corporation, a portion of the materials (a by-product) is removed further processed and sold. The entity uses the reversal costmethod to account for the by-product. Data for June include: Amount of by-productremoved is 2,000 units; Estimated sales price of by-product after processing further is$1.20/unit. Estimated processing cost after separation is $0.30 per unit andestimated selling expenses is 10% of the sales price. The estimated profit margin is5% of the sales price. a. How much is the total cost of the by-product?b. How much is the gain (loss) on sale of the by-product if all of the units are sold at $1.50?
B4. In a joint process, Tiny Town Lumbers produces two products: Long Boards and Really Long Boards. Joint processing costs for this quarter's production cycle are $66,000. Yards Sales price per yard at split-off Disposal cost per yard at split-off Further processing per yard Final sale price per yard Long Boards 1,440 $60.00 $3.50 $21.00 $ 77.50 Really Long Boards 2,160 80.00 5.00 33.00 111.25 If Long Boards and Really Long Boards are processed further, no disposal costs will be incurred or such costs will be borne by the buyer. Using a physical measure method, what amount of joint processing cost is allocated to Really Long Boards(round to the nearest dollar)? Group of answer choices $3,243 $26,400 $39,600 $4,757
A Chemical Company manufactures joint products Pep and Vim, and a by product Zest. Costs are assigned to the joint products by the market value method, which considers further processing costs in subsequent operations. For allocating cost to the by-product, the market value or reversal cost method is used. Total manufacturing costs for 10,000 units were P172,000 during the quarter. Production and cost data follow: Pep Vim Zest Unit Produced 5000 4000 1000 Sales price per unit 50 40 5 Further processing cost per unit 10 5 0 Selling and adm. Expense per unit 0 0 2 operating profit per unit 0 0 1 Required: The gross profit for pep is The value of Zest to deducted from the joint cost is
A Chemical Company manufactures joint products Pep and Vim, and a by-product Zest. Costs are assigned to the joint products by the market value method, which considers further processing costs in subsequent operations. For allocating cost to the by-product, the market value or reversal cost method is used. Total manufacturing costs for 10,000 units were P172,000 during the quarter. Production and cost data follow: Pep Vim Zest Units Produced 5,000 4,000 1,000 Sales price per unit 50.00 40.00 5.00 Further processing cost per unit 10.00 5.00 0.00 Selling & Adm. Expense per unit 0.00 0.00 2.00 Operating Profit per unit 0.00 0.00 1.00 The value of Zest to be deducted from the joint cost is
A Chemical Company manufactures joint products Pep and Vim, and a by-product Zest. Costs are assigned to the joint products by the market value method, which considers further processing costs in subsequent operations. For allocating cost to the by-product, the market value or reversal cost method is used. Total manufacturing costs for 10,000 units were P172,000 during the quarter. Production and cost data follow: Pep Vim Zest Units Produced 5,000 4,000 1,000 Sales price per unit 50.00 40.00 5.00 Further processing cost per unit 10.00 5.00 0.00 Selling & Adm. Expense per unit 0.00 0.00 2.00 Operating Profit per unit 0.00 0.00 1.00 The gross profit for Pep is
The Trece Co. manufactures joint products X and Y as well as by-product Z. Cumulative costs data for the period show P204,000 representing 20,000 units completed processed through the Refining Department at an average cost of P10.20. Costs are assigned to X and Y by the market value method which considers further processing costs in subsequent operations. Additional data: Z X Y Quantity processed 2,000 units 8,000 units 10,000 units Sales price per unit P5 P20 P25 Further processing cost per unit 1 5 7 Marketing and administrative expense per unit 1 Operating profit per unit 1 Required: a. Assuming by-product value is material determine the joint cost allocated to Z using Net realizable value method and joint cost to X and Y. b. Assuming by-product value is immaterial and insignificant, what is the joint cost allocated to X and Y.
Deporte Company produces single-colored T-shirts. Materials for the shirts are dyed inlarge vats. After dying the materials for a given color, the vats must be cleaned and preparedfor the next batch of materials to be colored. The following standards for changeover for agiven batch have been established:Direct materials (2.4 lbs. @ $0.95) $2.28Direct labor (0.75 hr. @ $7.40) 5.55Standard prime cost $7.83During the year, 79,500 pounds of material were purchased and used for the changeoveractivity. There were 30,000 batches produced, with the following actual prime costs:Direct materials $ 63,000Direct labor $163,385 (for 22,450 hrs.) Refer to the information for Deporte Company above.Required:Compute the materials and labor variances associated with the changeover activity, labelingeach variance as favorable or unfavorable.
Agao Chemical Company manufactures three chemicals (NY29, TX38, and CA55) from a joint process. The three chemicals are in industrial grade form at the split-off point. They can either be sold at that point or processed further into premium grade. Costs related to each batch of this chemical process is as follows: NY29 TX38 CA55 Sales value at split-off point P5,000 P16,000 P12,000 Allocated joint costs P6,000 P6,000 P6,000 Sales value after further processing P9,000 P20,000 P18,000 Cost of further processing P2,000 P5,000 P3,000 For which product(s) above would it be more profitable for Agao to sell at the split-off point rather than process further?
Yes Industries manufactures a single product using standard costing. Variableproduction costs are P13 and fixed production costs are P125,000. Yes uses anormal activity of 12,500 units to set its standard costs. Yes began the year with 1,000 units in inventory, produced 11,000 units, and sold 11,500 units. The standard cost of goods sold under absorption costing would be A. P115,000B. P149,500C. P253,000D. P264,500
In Department III of XYZ Company, a portion of the materials (a by-product) is removed further processed and sold. The Company uses the reversal cost method to account for the by-product. Data for June include: Amount of by-product removed is 2000 units; Estimated sales price of by-product after processing further is P1.20/unit. Estimated processing cost after separation is P0.30 per unit and estimated selling expenses is 10% of the sales price. The estimated profit margin is 5% of the sales price. What is the total cost of the by-product?what is the gain (loss) on sale of the by-product if all of the units are sold at P1.50?
ABC Manufacturing Company makes three products that can either be sold or processed further and then sold. The cost associated with the Bacolod joint process is P240,000. Units SP at split off Separable cost Final SP101 15,000 6.00 2.00 8.50202 20,000 4.00 1.00 6.00303 25,000 4.00 1.75 5.50Per unit, Product 101 weighs 3 ounces, Product 202 weighs 2 ounces, and Product 303 weighs 3 ounces. Which of the products should be processed further? A. Product 101 onlyB. Product 303 onlyC. Product 202 onlyD. Product 101 and 202
In Department II of Karen Corporation, a portion of the materials (a by-product) is removed further processed and sold. The Corporation uses the reversal cost method to account for the by-product. Data for November include: Amount of by-product removed is 2000 units; Estimated sales price of by-product after processing further is P1.20/unit. Estimated processing cost after separation is P0.30 per unit and estimated selling expenses is 10% of the sales price. The estimated profit margin is 5% of the sales price. 1. What is the total cost of the by-product?2. What is the gain (loss) on sale of the by-product if all of the units are sold for P1.50?