2. Joint product costing 17 Flora Perfume Company manufactures two perfume products in a joint process. In July, raw materials costing $50,000 were processed at a conversion cost of $80,000. The joint process resulted in 10 litres of product A and 15 litres of product B. Product A can be sold for $2 per millilitres, and product B can be sold for $1.5 per millilitres. Management generally processes each of these chemicals further in separable processes to produce more refined perfume products. Product A is processed separately at a cost of $0.5 per millilitres. The resulting product, product X sells for $5 per millilitres. Product B is processed separately at a cost of $0.75 per millilitres. The resulting product, product Y, sells for $3 per millilitres. Required: Allocate the company's joint production costs for July using: a. The physical unit method b. The relative-sales-value method. c. The net-realizable-value method

2. Joint product costing 17 Flora Perfume Company manufactures two perfume products in a joint process. In July, raw materials costing $50,000 were processed at a conversion cost of $80,000. The joint process resulted in 10 litres of product A and 15 litres of product B. Product A can be sold for $2 per millilitres, and product B can be sold for $1.5 per millilitres. Management generally processes each of these chemicals further in separable processes to produce more refined perfume products. Product A is processed separately at a cost of $0.5 per millilitres. The resulting product, product X sells for $5 per millilitres. Product B is processed separately at a cost of $0.75 per millilitres. The resulting product, product Y, sells for $3 per millilitres. Required: Allocate the company's joint production costs for July using: a. The physical unit method b. The relative-sales-value method. c. The net-realizable-value method

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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