Answered: Give two limitations of the physical…

Give two limitations of the physical measure method of a joint -cost allocation. Distinguish between the sales volume at split off method and the NRV method.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 26E: Refer to Exercise 7.25 and allocate the joint costs using the sales-value-at-split-off method.

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V4. Give two limitations of the physical measure method of a joint -cost allocation. Distinguish between the sales volume at split off method and the NRV method.

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Decision to Sell before or after additional processing

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Which of the following choices correctly denotes the data needed to allocate joint costs under the relative-sales-value method? Sales Value of Product at Split-Off Separable Cost Sales Value of Product After Processing Beyond Split-Off A. Yes Yes No B. Yes Yes Yes C. Yes No No D. No Yes Yes E. No No Yes Choice A Choice D Choice C Choice B Choice E
Using a physical measurement method, what amount of joint processing cost is allocated to product B? Using sales value at split-off, what amount of joint processing cost is allocated to Product B?
The following are approaches in allocating joint costs incurred up to split off point, except: a. Sales value method b. Physical unit method c. Fifo method d. Weighted average method
Using a physical measurement method, what amount of joint processing cost is allocated to Product B? c. P1,311.00 d. P3,495.00 b. P2,447.00 a. P1,748.00 Using the sales value at split-off point method, what of amount of joint processing cost is allocated to Product A? c. P1,108.00 b. P2,276.00 a. P4,433.00 d. P1,182.00 Using net realizable value after split-off point method, what amount of joint processing cost is allocated to Product C? d. P4,263.00 c. P2,375.00 b. P1,550.00 a. P1,017.00
Which of the following is the most commonly used method for assignment of joint costs? a. Relative sales value b. Split-off method c. Average production cost d. Relative percentage of direct costs basis
Under net realizable value method of apportioning joint costs to joint products, the selling & distribution cost is: a. Deducted from sales value b. Deducted from further processing cost c. Ignored d. Added to joint cost
Which of the following methods allocates joint costs based on the potential market value at the point where the products will be separated to be processed further? a.net realizable value method b.weighted average method c.market value at split-off method d.physical units method
Using sales value at split-off, what amount of joint processing cost is allocated to Product Alpha? Using a physical measurement method, what amount of joint processing cost is allocated to Product Gamma? Using net realizable value at split-off, what amount of joint processing cost is allocated to Product Delta?
HAHA manfactures products R, S and T from a joint process. Below are additional information: Question: How much is the joint cost allocated to S using sales value split off method.
When management believes that there is a direct link between the joint costs incurred and the value of products before further processing takes place, the _____ is the best alternative to allocating joint costs. A.physical measures methodB.NRV methodC.sales value at splitoff methodD.constant grossmargin percentage method
Using a physical measurement method, what amount is joint processing cost is allocated to product Wan? Using net realizable value at split-off, what amount of joint processing cost is allocated to product tri?
The decision of whether to process products beyond the splitoff process should be based on which of the following? Select one: a. Production cost analysis b. Revenue analysis c. Incremental operating income attainable beyond the splitoff point d. Relevant cost analysis e. Gross margin analysis