2. A vegetable oil refining company obtains four products whose cost details are: Joint costs of the four products: Rs. 8,29,600 Outputs: A - 5,00,000 litres; B -10,000 litres,C- 5,000 litres and D- 9,000 kgs. Further processing costs: A Rs. 2,40,000; B Rs. 48,000, C-Nil and D-Rs. 8,030. The products can be sold as intermediates i.e., at split-off point without further processing. The sale prices are: A Per litre B* Per litre C per litre D* Per Kg. As finished Product 1.84 8.00 6.40 26.67 As Intermediate (a) Calculate the product-wise profit allocating joint costs. (b) Compare the profitability in selling the products with and without further processing. 1.20 4.00 6.40 24.00

2. A vegetable oil refining company obtains four products whose cost details are: Joint costs of the four products: Rs. 8,29,600 Outputs: A - 5,00,000 litres; B -10,000 litres,C- 5,000 litres and D- 9,000 kgs. Further processing costs: A Rs. 2,40,000; B Rs. 48,000, C-Nil and D-Rs. 8,030. The products can be sold as intermediates i.e., at split-off point without further processing. The sale prices are: A Per litre B* Per litre C per litre D* Per Kg. As finished Product 1.84 8.00 6.40 26.67 As Intermediate (a) Calculate the product-wise profit allocating joint costs. (b) Compare the profitability in selling the products with and without further processing. 1.20 4.00 6.40 24.00

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

2. A vegetable oil refining company obtains four products whose cost details are:
Joint costs of the four products: Rs. 8,29,600
Outputs: A - 5,00,000 litres; B-10,000 litres,C- 5,000 litres and D- 9,000 kgs.
Further processing costs: A Rs. 2,40,000; B Rs. 48,000, C-Nil and D-Rs. 8,030.
The products can be sold as intermediates i.e., at split-off point without further processing. The sale
prices are:
A Per litre
B Per litre
C per litre
D* Per Kg.
As finished Product
1.84
8.00
6.40
26.67
As Intermediate
(a) Calculate the product-wise profit allocating joint costs.
(b) Compare the profitability in selling the products with and without further processing.
1.20
4.00
6.40
24.00

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