ALASKA Company manufactures products F, G and W from a joint process. Joint costs are allocated on the basis of relative sales value at split-off. Additional informaton for the June 20x1 production activity as follows: F G W Total Units produced 50,000 40,000 10,000 100,000 Joint costs ? ? ? P450,000 Sales value at split-off P420,000 P270,000 P60,000 P750,000 Additional costs if processed further 88,000 30,000 12,000 130,000 Sales value if processed further 538,000 320,000 78,000 936,000 Assuming that the 10,000 units of W were processed further and sold for P78,000, what was ALASKA's gross profit on this sale?
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.
ALASKA Company manufactures products F, G and W from a joint process. Joint costs are allocated on the basis of relative sales value at split-off. Additional informaton for the June 20x1 production activity as follows:
F G W Total
Units produced 50,000 40,000 10,000 100,000
Joint costs ? ? ? P450,000
Sales value at split-off P420,000 P270,000 P60,000 P750,000
Additional
processed further 88,000 30,000 12,000 130,000
Sales value if processed
further 538,000 320,000 78,000 936,000
Assuming that the 10,000 units of W were processed further and sold for P78,000, what was ALASKA's gross profit on this sale?
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