Exercise 8-8. JOINT COST ALLOCATION & BYPRODUCT ALLOCATION – MARKET VALUE МЕТHOD The BAR Company manufactures joint products A and R as well as byproduct B. Cumulative cost data for the period show P204,000 representing 20,000 completed units processed through the Refining Department at an average cost of P10.20. Costs are assigned to A and R by the market value method which considers further processing costs in subsequent operations. To determine the cost allocation to B, the market value (reversal cost) method is used. Additional data: Quantity processed Sales price per unit Further processing cost per unit Selling and general expenses per unit Operating profit per unit REQUIRED: Cumulative cost allocated to B, A, and R B 2,000 P 5.00 1.00 1.00 1.00 R 10,000 P25.00 7.00 8,000 P20.00 5.00
Exercise 8-8. JOINT COST ALLOCATION & BYPRODUCT ALLOCATION – MARKET VALUE МЕТHOD The BAR Company manufactures joint products A and R as well as byproduct B. Cumulative cost data for the period show P204,000 representing 20,000 completed units processed through the Refining Department at an average cost of P10.20. Costs are assigned to A and R by the market value method which considers further processing costs in subsequent operations. To determine the cost allocation to B, the market value (reversal cost) method is used. Additional data: Quantity processed Sales price per unit Further processing cost per unit Selling and general expenses per unit Operating profit per unit REQUIRED: Cumulative cost allocated to B, A, and R B 2,000 P 5.00 1.00 1.00 1.00 R 10,000 P25.00 7.00 8,000 P20.00 5.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 8-8. JOINT COST ALLOCATION & BYPRODUCT ALLOCATION – MARKET VALUE
МЕТНOD
The BAR Company manufactures joint products A and R as well as byproduct B. Cumulative cost
data for the period show P204,000 representing 20,000 completed units processed through the
Refining Department at an average cost of P10.20. Costs are assigned to A and R by the market
value method which considers further processing costs in subsequent operations. To determine the
cost allocation to B, the market value (reversal cost) method is used. Additional data:
B
2,000
P 5.00
1.00
1.00
1.00
R
10,000
A
8,000
P20.00
5.00
Quantity processed
Sales price per unit
Further processing cost per unit
Selling and general expenses per unit
Operating profit per unit
REQUIRED: Cumulative cost allocated to B, A, and R
P25.00
7.00
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