Exercise 8-2. JOINT COST ALLOCATIONThe AB Company produces three joint products, A, N and T. During February, the following informationwas recorded:TotalProductAProduct ProductINJoint materialsP 5,000Joint processing costSeparable processing costsOutput in unitsKilograms per unitSales price per unit @ split offIndex pointsREQUIRED: Compute for the gross profit for each product by allocating the joint cost using: [a] marketvalue method, [b]quantitative unit method; [c] average unit cost method; [d] weighted averagemethod25,000P 5,00015,00010,000P8,000P2,0002,0005,0003,0003P5.00 P 3.00P 4.00243

Gross profit is the initial profit level of any business attained directly from the sale of goods or…

Answered: P 5,000 25,000 15,000 P 5,000 5,000…

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P 5,000 25,000 15,000 P 5,000 5,000 P8,000 P2,000 3,000 3 2,000 10,000

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter2: Basic Managerial Accounting Concepts

Section: Chapter Questions

Problem 39E: Cost Classification Loring Company incurred the following costs last year: Required: 1. Classify...

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Question

Exercise 8-2. JOINT COST ALLOCATION
The AB Company produces three joint products, A, N and T. During February, the following information
was recorded:
Total
Product
A
Product Product
I
N
Joint materials
P 5,000
Joint processing cost
Separable processing costs
Output in units
Kilograms per unit
Sales price per unit @ split off
Index points
REQUIRED: Compute for the gross profit for each product by allocating the joint cost using: [a] market
value method, [b]quantitative unit method; [c] average unit cost method; [d] weighted average
method
25,000
P 5,000
15,000
10,000
P8,000
P2,000
2,000
5,000
3,000
3
P5.00 P 3.00
P 4.00
2
4
3

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