A company manufactures two joint products and one by-product in a single process. Data for November are as follows. $ Raw material input 216,000 Conversion costs 72,000 There were no inventories at the beginning or end of the period. Output Sales price Units $ per unit Joint product E 21,000 15 Joint product Q 18,000 10 By-product X 2,000 2 By-product sales revenue is credited to the process account. Joint costs are apportioned on a sales value basis. What were the full production costs of product Q in November (to the nearest $)? A $102,445 B $103,273 C $104,727 D $180,727
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
A company manufactures two joint products and one by-product in a single process. Data for November
are as follows.
$
Raw material input 216,000
Conversion costs 72,000
There were no inventories at the beginning or end of the period.
Output Sales price
Units $ per unit
Joint product E 21,000 15
Joint product Q 18,000 10
By-product X 2,000 2
By-product sales revenue is credited to the process account. Joint costs are apportioned on a sales value
basis. What were the full production costs of product Q in November (to the nearest $)?
A $102,445
B $103,273
C $104,727
D $180,727
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