ABC Company operates a production process to convert a single material into three separate items, referred to as items A, B and C. Products A and B are ready for sale immediately upon split-off without further processing. Product C, however, is processed further before being saleable. During 2022, the selling prices of the items and the total amounts sold were as follows: Product A – 168 units at P1,200 per unit Product B – 480 units at P900 per unit Product C – 672 units at P600 per unit Total manufacturing costs for the year amounted to P900,000 which includes further processing costs of product C of P200,000. There were no beginning inventories while a physical count revealed the following unsold units at the end of 2022: A, 132 units, B, 120 units, C, 28 units. 1. How much is the ending inventory to be reported for product A using the physical measures approach? 2. How much is the ending inventory to be reported for product B using the physical measures approach?
ABC Company operates a production process to convert a single material into three separate items, referred to as items A, B and C. Products A and B are ready for sale immediately upon split-off without further processing. Product C, however, is processed further before being saleable. During 2022, the selling prices of the items and the total amounts sold were as follows:
Product A – 168 units at P1,200 per unit
Product B – 480 units at P900 per unit
Product C – 672 units at P600 per unit
Total
There were no beginning inventories while a physical count revealed the following unsold units at the end of 2022: A, 132 units, B, 120 units, C, 28 units.
1. How much is the ending inventory to be reported for product A using the physical measures approach?
2. How much is the ending inventory to be reported for product B using the physical measures approach?
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