Accounting Split Corporation manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products based on relative sales values of the products at the split-off point. Additionalinformation is as follows:Units producedAllocated joint costsSales value at split-offAdditional costs for further processingSales value if processed furtherMultiple ChoiceOnly XOnly YOnly ZBased solely on a relevant cost analysis, which of the three products should be processed by Split beyond the split-off point?Only Y and ZX28,000$ 429,200All three products: X,Y and Z?80,000588,000Y24,000$ 229,400310,00072,000485,00020,000$ 199,800270,00050,000447,000Total72,000$ 858,4001,160,000202,0001,520,000

The differential analysis is performed to compare the different alternatives available. The product…

Split Corporation manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products based on relative sales values of the products at the split-off point. Additional nformation is as follows: Multiple Choice O Units produced Allocated joint costs Sales value at split-off Additional costs for further processing ? 80,000 588,000 Sales value if processed further Based solely on a relevant cost analysis, which of the three products should be processed by Split beyond the split-off point? O Only X Only Y Only Z Only Y and Z X 28,000 $ 429,200 All three products: X,Y and Z Y 24,000 $ 229,400 310,000 72,000 485,000 Z 20,000 $ 199,800 270,000 50,000 447,000 Total 72,000 $ 858,400 1,160,000 202,000 1,520,000

Split Corporation manufactures products X, Y, and Z from a joint production process. Joint costs are allocated to products based on relative sales values of the products at the split-off point. Additional nformation is as follows: Multiple Choice O Units produced Allocated joint costs Sales value at split-off Additional costs for further processing ? 80,000 588,000 Sales value if processed further Based solely on a relevant cost analysis, which of the three products should be processed by Split beyond the split-off point? O Only X Only Y Only Z Only Y and Z X 28,000 $ 429,200 All three products: X,Y and Z Y 24,000 $ 229,400 310,000 72,000 485,000 Z 20,000 $ 199,800 270,000 50,000 447,000 Total 72,000 $ 858,400 1,160,000 202,000 1,520,000

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 10CE: A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each...

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A company manufactures three products, L-Ten, Triol, and Pioze, from a joint process. Each production run costs 12,900. None of the products can be sold at split-off, but must be processed further. Information on one batch of the three products is as follows: Required: 1. Allocate the joint cost to L-Ten, Triol, and Pioze using the net realizable value method. (Round the percentages to four significant digits. Round all cost allocations to the nearest dollar.) 2. What if it cost 2 to process each gallon of Triol beyond the split-off point? How would that affect the allocation of joint cost to the three products?
Harvey Corporation produces several joint products fromcommon materials and shared production processes. Whyare costs incurred up to the split-off point not relevant indeciding which products Harvey sells at the split-off pointand which products it processes further?
Products G and H are joint products developed from the same process with each being processed further. Joint costs are incurred until split-off, the separable costs are incurred in further refining each product. Sales values of G and H at split-off are used to allocate joint costs. If the sales value of G at split-off increases and all other costs and selling prices remain unchanged, the gross margin of A. G- decreases while H increases B. G- increases while H decreases C. G- increases and H increases D. G- decreases and H decreases
Product X-547 is one of the joint products in a joint manufacturing process. Management is considering whether to sell X-547 at the split-off point or to process X-547 further into Xylene. The following data have been gathered: Selling price of X-547 Variable cost of processing X-547 into Xylene. The avoidable fixed costs of processing X-547 into Xylene. The selling price of Xylene. The joint cost of the process from which X-547 is produced. Which of the above items are relevant in a decision of whether to sell the X-547 as is or process it further into Xylene?
Which of the following statements is true? An avoidable fixed production cost incurred before the split-off point in a joint process is relevant in a sell or process further decision. It is profitable to continue processing joint products after the split-off point if their total revenues exceed the joint costs. Which of the following statements is true? Consistency demands that a cost that is relevant in one decision be regarded as relevant in other decisions as well. Variable costs are always relevant costs in decisions.
Milo Manufacturing produces products Kappa and Lambda from a joint process. Total joint costs are $158,000. The sales value at split-off was $167,760 for 4,400 units of Kappa and $63,280 for 6,600 units of Lambda. Required: What joint costs are allocated to the two products using the net realizable value at split-off approach? Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts. What joint costs are allocated to the two products using the physical quantities method? Note: Do not round intermediate calculations.
Milo Manufacturing produces products Kappa and Lambda from a joint process. Total joint costs are $168,000. The sales value at split-off was $174,960 for 8,400 units of Kappa and $63,280 for 12,600 units of Lambda. Required: What joint costs are allocated to the two products using the net realizable value at split-off approach? Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts. What joint costs are allocated to the two products using the physical quantities method? Note: Do not round intermediate calculations. Kappa Lambda a. Net realizable value method ??? ??? b. Physical quantities method ??? ???
Joint (common) costs in a joint production process are relevant for determining: Multiple Choice Which products should be produced internally and which products should be outsourced. The selling price of individual products produced as part of the joint production process. Which products should be produced up to the split-off point in the production process. Whether to produce at all. The set of products that should be subjected to additional processing.
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
Mephis Manufacturing has a manufacturing process that results in four separate products that together incur some portion of joint costs. If the appropriate split-off point is determined to be at the third stage in the production process, how will the costs incurred after the third stage be accounted for?
In the sell-or-process-further decision,a. joint costs are always relevant.b. total costs of joint processing and further processing are relevant.c. all costs incurred prior to the split-off point are relevant.d. the most profitable outcome may be to further process some separately identifiable products beyond the split-off point, but sell others at the split-off point.e. None of these
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