Company manufactures products R, S, and T from a joint process. The following information is available: Product R S T Total Units produced 25,000 ? ? 50,000 Sales value at split-off ? ? $ 103,000 $ 420,000 Joint costs $ 100,000 ? ? $ 250,000 Sales value if processed further $ 240,000 $
Company manufactures products R, S, and T from a joint process. The following information is available: Product R S T Total Units produced 25,000 ? ? 50,000 Sales value at split-off ? ? $ 103,000 $ 420,000 Joint costs $ 100,000 ? ? $ 250,000 Sales value if processed further $ 240,000 $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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ohns Company manufactures products R, S, and T from a joint process. The following information is available:
| Product | |||||||||||
| R | S | T | Total | ||||||||
| Units produced | 25,000 | ? | ? | 50,000 | |||||||
| Sales value at split-off | ? | ? | $ | 103,000 | $ | 420,000 | |||||
| Joint costs | $ | 100,000 | ? | ? | $ | 250,000 | |||||
| Sales value if processed further | $ | 240,000 | $ | 187,500 | $ | 125,000 | $ | 552,500 | |||
| Additional costs if processed further | $ | 37,500 | $ | 28,000 | $ | 21,250 | $ | 86,750 | |||
Assuming that joint product costs are allocated using the relative-sales-value at split-off approach, what was the sales value at split-off for products R and S?
| Product R | Product S | ||||
| A) | $ | 143,000 | $ | 154,000 | |
| B) | $ | 151,000 | $ | 160,000 | |
| C) | $ | 168,000 | $ | 149,000 | |
| D) | $ | 179,000 | $ | 162,000 | |
| E) | $ | 189,000 | $ | 171,000 | |
Multiple Choice
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Option A
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Option B
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Option C
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Option D
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Option E
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