The following information relates to a joint production process for three products, with a total joint production cost of $200,000. There are no separable processing costs for any of the three products. Product Sales Value at Split-Off Units at Split-Off 1 $ 280,000 585 2 80,000 1,170 3 40,000 2,145 $ 400,000 3,900 Assume that the total sales value at the split-off point for product 1 is $120,000 instead of $280,000 and the sales value of product 3 is $4,000 instead of $40,000. Assume also that the firm treats product 3 as a joint product and uses the net realizable value method for accounting for joint costs. There are no separable processing costs for product 3. What amount of joint costs would be allocated to the three products using the relative sales value method?
The following information relates to a joint production process for three products, with a total joint production cost of $200,000. There are no separable processing costs for any of the three products. Product Sales Value at Split-Off Units at Split-Off 1 $ 280,000 585 2 80,000 1,170 3 40,000 2,145 $ 400,000 3,900 Assume that the total sales value at the split-off point for product 1 is $120,000 instead of $280,000 and the sales value of product 3 is $4,000 instead of $40,000. Assume also that the firm treats product 3 as a joint product and uses the net realizable value method for accounting for joint costs. There are no separable processing costs for product 3. What amount of joint costs would be allocated to the three products using the relative sales value method?
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter6: Process Cost Accounting—additional Procedures; Accounting For Joint Products And By-products
Section: Chapter Questions
Problem 13P: Venezuela Oil Inc. transports crude oil to its refinery where it is processed into main products...
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The following information relates to a joint production process for three products, with a total joint production cost of $200,000. There are no separable
| Product | Sales Value at Split-Off | Units at Split-Off |
|---|---|---|
| 1 | $ 280,000 | 585 |
| 2 | 80,000 | 1,170 |
| 3 | 40,000 | 2,145 |
| $ 400,000 | 3,900 |
Assume that the total sales value at the split-off point for product 1 is $120,000 instead of $280,000 and the sales value of product 3 is $4,000 instead of $40,000. Assume also that the firm treats product 3 as a joint product and uses the net realizable value method for accounting for joint costs. There are no separable processing costs for product 3. What amount of joint costs would be allocated to the three products using the relative sales value method?
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