Concord Inc. is in the corn-milling industry but to date has had only enough manufacturing space for one joint process. Concord refers to its two products as prime products and by-products. There is a market for both products, but as the names imply the prime products are what Concord got into business to sell, as the prime products' sales price far exceeds that of the by-products. In a typical production run, which costs $64,000, Concord Inc produces the following products, which can be sold at the prices shown. Prime products By-products Quantity Produced 1.700 tons 850 tons (a) Sales Price per Ton $50 $5 Because Concord's customers (the corn processors) count on purchasing top-quality raw material from Concord, it is important that the company maintains a steady amount of inventory. For this reason, Concord never completely sells out of its products. For the current production run, managers plan to sell 80% of each product immediately, holding 20% in inventory to carry into the next period. Record the journal entries to recognize the completion of the products through the sale of both products if the production method is used to account for by-products (Credit account titles are automatically indented when the amount is entered. Do not indent in Enter for the are for the debit autelar halamand
Concord Inc. is in the corn-milling industry but to date has had only enough manufacturing space for one joint process. Concord refers to its two products as prime products and by-products. There is a market for both products, but as the names imply the prime products are what Concord got into business to sell, as the prime products' sales price far exceeds that of the by-products. In a typical production run, which costs $64,000, Concord Inc produces the following products, which can be sold at the prices shown. Prime products By-products Quantity Produced 1.700 tons 850 tons (a) Sales Price per Ton $50 $5 Because Concord's customers (the corn processors) count on purchasing top-quality raw material from Concord, it is important that the company maintains a steady amount of inventory. For this reason, Concord never completely sells out of its products. For the current production run, managers plan to sell 80% of each product immediately, holding 20% in inventory to carry into the next period. Record the journal entries to recognize the completion of the products through the sale of both products if the production method is used to account for by-products (Credit account titles are automatically indented when the amount is entered. Do not indent in Enter for the are for the debit autelar halamand
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Gg.34.
Transcribed Image Text:Concord Inc. is in the corn-milling industry but to date has had only enough manufacturing space for one joint process. Concord refers
to its two products as prime products and by-products. There is a market for both products, but, as the names imply, the prime
products are what Concord got into business to sell, as the prime products sales price far exceeds that of the by-products. In a typical
production run, which costs $64,000, Concord Inc. produces the following products, which can be sold at the prices shown.
Prime products
By-products
Quantity Produced
1.700 tons
850 tons
(a)
Because Concord's customers (the corn processors) count on purchasing top-quality raw material from Concord, it is important that
the company maintains a steady amount of inventory. For this reason, Concord never completely sells out of its products. For the
current production run, managers plan to sell 80% of each product immediately, holding 20% in inventory to carry into the next
period.
Record the journal entries to recognize the completion of the products through the sale of both products if the production
method is used to account for by-products (Credit account titles are automatically indented when the amount is entered. Do not indent
manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts List all debit entries before credit
entries.)
Account Titles and Explanation
(To record completion of products)
(To record sales of prime products)
Sales Price per Ton
$50
$5
(To record cost of goods sold)
(To record sale of by-products)
Debit
Credit
000
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