Problem 18A factory produces three products L, M and N of equal value from the samemanufacturing process. The costs before the split off point is RO 298,800.The number of units, Subsequent costs and profit percentages are given as under :ParticularsL10000251020%MN12000 16000406081620%10%No. of UnitsSelling Price per unit in ROSubsequent costs per unit in ROEstimated profit on SalesApportion the joint costs by using Reverse Cost Method and find profit Problem 19A company manufactures product A, B and C. The actual joint expensesof manufacture for a period were RO 63,000. It was estimated that profitson each product as a percentage of sales would be 30%, 25% and 15%respectively. Subsequent expenses were:BсAMaterial RO 1000Direct wagesOverheadsRO 2000RO 1500RO 4500RO 60,000RO 750RO 1250RO 1250RO 250RO 3250RO 500TotalSalesRO 40,000RO 25,000Prepare a statement showing the apportionment of joint expenses.RO 750RO 1500

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Business

Accounting

Prepare a statement showing the apportionment of joint expenses.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter5: Support Department And Joint Cost Allocation

Section: Chapter Questions

Problem 3CMA: Breegle Company produces three products (B-40, J-60, and H-102) from a single process. Breegle uses...

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Question

Problem 18
A factory produces three products L, M and N of equal value from the same
manufacturing process. The costs before the split off point is RO 298,800.
The number of units, Subsequent costs and profit percentages are given as under :
Particulars
L
10000
25
10
20%
M
N
12000 16000
40
60
8
16
20%
10%
No. of Units
Selling Price per unit in RO
Subsequent costs per unit in RO
Estimated profit on Sales
Apportion the joint costs by using Reverse Cost Method and find profit

Problem 19
A company manufactures product A, B and C. The actual joint expenses
of manufacture for a period were RO 63,000. It was estimated that profits
on each product as a percentage of sales would be 30%, 25% and 15%
respectively. Subsequent expenses were:
B
с
A
Material RO 1000
Direct wages
Overheads
RO 2000
RO 1500
RO 4500
RO 60,000
RO 750
RO 1250
RO 1250
RO 250
RO 3250
RO 500
Total
Sales
RO 40,000
RO 25,000
Prepare a statement showing the apportionment of joint expenses.
RO 750
RO 1500

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Computing joint costssales value at split-off and net realizable value methods D.L. Manufacturing Inc.s joint cost of producing 1,000 units of Product A, 500 units of Product B, and 500 units of Product C is 20,000. The unit sales values of the three products at the split-off point are Product A20, Product B200, and Product C160. Ending inventories include 100 units of Product A, 200 units of Product B, and 300 units of Product C. a. Compute the amount of joint cost that would be included in the ending inventory valuation of the three products on the basis of their sales value at split off. b. Assume that Product C can be sold for 200 a unit if it is processed after split-off at a cost of 25 a unit. Compute the amount of joint cost that would be included in the ending inventory valuation of the three products on the basis of their net realizable values.
Refer to Cornerstone Exercise 7.7. Assume that Orchard Fresh, Inc., uses the weighted average method of joint cost allocation and has assigned the following weights to the four grades of apples: Total joint cost is 18,000. Required: 1. Allocate the joint cost to the four grades of apples using the weighted average method. (Carry out the percent calculations to four significant digits. Round all cost allocations to the nearest dollar.) 2. What if the factory found that Grade A apples were being valued less by customers and decided to decrease the weight factor for Grade A apples to 3.0? How would that affect the allocation of cost to Grade A apples? How would it affect the allocation of cost to the remaining grades?
Appendix Absorption costing income statement On June 30, the end of the first month of operations, Tudor Manufacturing Co. prepared the following income statement, based on the variable existing concept: Sales (420,000 units) 7,450,000 Variable cost of goods sold: Variable cost of goods manufactured (500,000 units x 14 per unit) 7,000,000 Less ending inventory (80,000 units x 14 per unit) 1,120,000 Variable cost of goods sold 5,880,000 Manufacturing margin 1,570,000 Variable selling and administrative expenses 80,000 Contribution margin 1,490,000 Fixed costs: Fixed manufacturing costs 160,000 Fixed selling and administrative expenses 75,000 235,000 Income from operations 1,255,000 a. Prepare an absorption costing income statement. b. Reconcile the variable costing income from operations of 1,255,000 with the absorption costing income from operations determined in (a).
(Appendix 11A) Manufacturing Cycle Efficiency Kurena Company provided the following information on one of its factories: Maximum units produced in a quarter: 180,000 units Actual units produced in a quarter: 112,500 units Hours of cell production labor in a quarter: 30,000 hours Theoretical cycle time: 10 minutes per unit Actual cycle time: 16 minutes per unit Required: 1. Calculate the amount of processing time per unit and the amount of nonprocessing time per unit. 2. Calculate the MCE (rounded to three significant digits).
Breegle Company produces three products (B-40, J-60, and H-102) from a single process. Breegle uses the physical volume method to allocate joint costs of 22,500 per batch to theproducts. Based on the following information, which product(s) should Breegle continue toprocess after the split-off point in order to maximize profit? a. B-40 only b. J-60 only c. H-102 only d. B-40 and H-102 only