Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Textbook Question
Chapter 7, Problem 26E
Refer to Exercise 7.25 and allocate the joint costs using the sales-value-at-split-off method.
Expert Solution & Answer
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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
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
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
Chapter 7 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 7 - Describe the two-stage allocation process for...Ch. 7 - Why must support service costs be assigned to...Ch. 7 - Explain how allocation of support service costs is...Ch. 7 - Prob. 4DQCh. 7 - Explain how allocating support service costs will...Ch. 7 - Prob. 6DQCh. 7 - Explain why it is better to allocate budgeted...Ch. 7 - Why is it desirable to allocate variable costs and...Ch. 7 - Explain why either normal or peak capacity of the...Ch. 7 - Explain why variable bases should not be used to...
Ch. 7 - Prob. 11DQCh. 7 - Explain the difference between the direct method...Ch. 7 - The reciprocal method of allocation is more...Ch. 7 - What is a joint cost? How does it relate to...Ch. 7 - How do joint costs differ from other common costs?Ch. 7 - The expected costs for the Maintenance Department...Ch. 7 - Prob. 2CECh. 7 - Valron Company has two support departments, Human...Ch. 7 - Refer to Cornerstone Exercise 7.3. Now assume that...Ch. 7 - Refer to Cornerstone Exercise 7.3. Now assume that...Ch. 7 - Refer to Cornerstone Exercise 7.3 and solve for...Ch. 7 - Orchard Fresh, Inc., purchases apples from local...Ch. 7 - Refer to Cornerstone Exercise 7.7. Assume that...Ch. 7 - Refer to Cornerstone Exercise 7.7. Assume that...Ch. 7 - A company manufactures three products, L-Ten,...Ch. 7 - Refer to Cornerstone Exercise 7.10. (Round...Ch. 7 - Classify each of the following departments in a...Ch. 7 - Prob. 13ECh. 7 - Identify some possible causal factors for the...Ch. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Prob. 17ECh. 7 - Kumar, Inc., evaluates managers of producing...Ch. 7 - Refer to the data in Exercise 7.18. When the...Ch. 7 - Jasmine Company manufactures both pesticide and...Ch. 7 - Refer to the data in Exercise 7.20. The company...Ch. 7 - Eilers Company has two producing departments and...Ch. 7 - Refer to the data in Exercise 7.22. The company...Ch. 7 - Refer to the data in Exercise 7.22. The support...Ch. 7 - Alomar Company manufactures four products from a...Ch. 7 - Refer to Exercise 7.25 and allocate the joint...Ch. 7 - Pacheco, Inc., produces two products, overs and...Ch. 7 - Minor Co. has a job order cost system and applies...Ch. 7 - A CPA would recommend changing from plantwide...Ch. 7 - A company uses charging rates to allocate service...Ch. 7 - Chester Company provided information on overhead...Ch. 7 - Which of the following statements is true? a. The...Ch. 7 - Biotechtron, Inc., has two research laboratories...Ch. 7 - AirBorne is a small airline operating out of...Ch. 7 - Duweynie Pottery, Inc., is divided into two...Ch. 7 - Macalister Corporation is developing departmental...Ch. 7 - Prob. 37PCh. 7 - Welcome Inns is a chain of motels serving business...Ch. 7 - Sonimad Sawmill, Inc. (SSI), purchases logs from...Ch. 7 - Prob. 40P
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
For which cost concept used in applying (he cost-plus, approach to product pricing are fixed manufacturing costs, fixed selling and administrative expenses, and desired profit allowed for in determining the markup? A. Total cost B. Product cost C. Variable cost D. Standard cost
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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
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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
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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.
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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?
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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
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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
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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?
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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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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
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“ Managers must decide whether a product should be sold at splitoff or processed furthur.The sales value at splitoff method of joint-cost allocation is the best method for generating the information managers need for this decision.”Do you agree? Explain.
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Please include a solution. ThanksThe joint production cost allocation result in the following values:(see pic)REQUIRED: Compute the weighted units and cost per unit of each product.
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