ABC Company produces two main products and a by-product out of a joint process. The ratio of output quantities to input quantities of direct material used in the joint process remains consistent from month to month. ABC employs the physical units, method to allocate joint pro- duction costs to the two main products. The net realizable value of the by-product is used to reduce the joint production costs before the joint costs are allocated to the main products. Da- ta regarding ABC's operations for the current month are presented below. During the month, ABC incurred joint production costs of P2,520,000. The main products are not mar- ketable at the split-off point and, thus, have to be processed further. First Main Product Second Main Product By.Product 150,000 60,000 Monthly output in Kilos.. Selling price per Kil . Separable process costs.. 90,000 P30 P14 P2 P540,000 P660,000 The amount of joint production cost that ABC would allocate to the Second Main Product by using the physical units, method to allocate joint production costs would be: P1,200,000. P1,260,000. P1,500,000. P1,575,000. P1,650,000.

ABC Company produces two main products and a by-product out of a joint process. The ratio of output quantities to input quantities of direct material used in the joint process remains consistent from month to month. ABC employs the physical units, method to allocate joint pro- duction costs to the two main products. The net realizable value of the by-product is used to reduce the joint production costs before the joint costs are allocated to the main products. Da- ta regarding ABC's operations for the current month are presented below. During the month, ABC incurred joint production costs of P2,520,000. The main products are not mar- ketable at the split-off point and, thus, have to be processed further. First Main Product Second Main Product By.Product 150,000 60,000 Monthly output in Kilos.. Selling price per Kil . Separable process costs.. 90,000 P30 P14 P2 P540,000 P660,000 The amount of joint production cost that ABC would allocate to the Second Main Product by using the physical units, method to allocate joint production costs would be: P1,200,000. P1,260,000. P1,500,000. P1,575,000. P1,650,000.

Name: ABC Company produces two main products and a by-product out of a join
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Description: ABC Company produces two main products and a by-product out of a joint process. The ratioof output quantities to input quantities of direct material used in the joint process remainsconsistent from month to month. ABC employs the physical units meth

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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For joint cost allocation: only the net realizable method can be used to allocate joint costs to by-products. only the relative sales value method can be used to allocate joint costs to scrap. separable costs do not include disposal costs. no joint costs are allocated to by-products or scrap. the most accurate method is the one using physical measures of output.
Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. Marley's ManufacturingIncome StatementMonth Ending August 31, 2018 Dept. A Dept. B Sales $23,000 $50,000 Cost of goods sold 11,270 25,500 Gross profit $11,730 $24,500 Expenses: Utility expenses $1,380 $3,000 Wages expense 5,520 10,000 Costs allocated from corporate 2,070 14,000 Total expenses $8,970 $27,000 Operating income/(loss) in dollars $fill in the blank 1 $fill in the blank 2 Operating income/(loss) in percentage fill in the blank 3 % fill in the blank 4 %
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Assume you are the department B manager for Marley's Manufacturing. Marley's operates under a cost-based transfer structure. Assume you receive the majority of your raw materials from department A, which sells only to department B (they have no outside sales). After calculating the operating income in dollars and operating income in percentage, analyze the following financial information to determine costs that may need further investigation. Marley's ManufacturingIncome StatementMonth Ending August 31, 2018 Dept. A Dept. B Sales $21,000 $52,000 Cost of goods sold 9,870 27,040 Gross profit $11,130 $24,960 Expenses: Utility expenses $840 $3,120 Wages expense 5,040 10,920 Costs allocated from corporate 2,100 14,560 Total expenses $7,980 $28,600 Operating income/(loss) in dollars $fill in the blank 1 $fill in the blank 2 Operating income/(loss) in percentage fill in the blank 3 % fill in the blank 4 % Department B had…
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Elliott Company... (see pictures).