Chemi Co. produces chemicals Koo and Lam and incident to their production recovers a by-product, Boo. The joint costs of processing is reduced by the net realizable value of Boo. For the month of May 2021, the joint costs of processing amount to P3,840,000. Additional information are shown below: Assuming the company uses the net realizable value method for aallocating joint costs, the joint costs allocated to Koo would be: A. 1,800,000 B. 2,160,000 C. 2,208,000 D. 2,700,000
Chemi Co. produces chemicals Koo and Lam and incident to their production recovers a by-product, Boo. The joint costs of processing is reduced by the net realizable value of Boo. For the month of May 2021, the joint costs of processing amount to P3,840,000. Additional information are shown below: Assuming the company uses the net realizable value method for aallocating joint costs, the joint costs allocated to Koo would be: A. 1,800,000 B. 2,160,000 C. 2,208,000 D. 2,700,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Chemi Co. produces chemicals Koo and Lam and incident to their production recovers a by-product, Boo. The joint costs of processing is reduced by the net realizable value of Boo. For the month of May 2021, the joint costs of processing amount to P3,840,000. Additional information are shown below:
Assuming the company uses the net realizable value method for aallocating joint costs, the joint costs allocated to Koo would be:
A. 1,800,000
B. 2,160,000
C. 2,208,000
D. 2,700,000
Transcribed Image Text:Production
2,000,000
3,000,000
1,000,000
Product
Market Value
Коо
P3,000,000
2,000,000
420,000
Lam
Boo
An additional P180,000 was spent to complete the processing of Boo. Assuming that the
company uses the net realizable value method for allocating joint costs, the joint costs
allocated to Koo would be
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