Required information [The following information applies to the questions displayed below.] The following information relates to a joint production process for three products, with a total joint production cost of $180,000. There are no separable processing costs for any of the three products. Product 1 2 3 Sales Value at Split-Off $ 252,000 Product 1 2 3 72,000 36,000 $360,000 Assume that the total sales value at the split-off point for product 1 is $108,000 instead of $252,000 and the sales value of product 3 is $3,600 instead of $36,000. Assume also that, because of its relatively low sales value, the firm treats product 3 as a by-product and uses an asset recognition method (the NRV method) for accounting for by-products. What amount of joint cost would be allocated to the products using the sales value at split-off method? Units at Split-Off 350 1,050 2,100 3,500 Allocated Joint Cost

Required information [The following information applies to the questions displayed below.] The following information relates to a joint production process for three products, with a total joint production cost of $180,000. There are no separable processing costs for any of the three products. Product 1 2 3 Sales Value at Split-Off $ 252,000 Product 1 2 3 72,000 36,000 $360,000 Assume that the total sales value at the split-off point for product 1 is $108,000 instead of $252,000 and the sales value of product 3 is $3,600 instead of $36,000. Assume also that, because of its relatively low sales value, the firm treats product 3 as a by-product and uses an asset recognition method (the NRV method) for accounting for by-products. What amount of joint cost would be allocated to the products using the sales value at split-off method? Units at Split-Off 350 1,050 2,100 3,500 Allocated Joint Cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Denver Fabricators manufactures products DF1 and DF2 from a joint process, which also yields a by-product, BP. The company accounts for the revenues from its by-product sales as other income. Additional information follows: DF1 DF2 BP Total Units produced 27,100 18,100 15,100 60,300 Allocated joint costs ? ? ? $ 560,100 Sales value at split-off $ 561,750 $ 187,250 $ 102,100 $ 851,100 Required: Assuming that joint product costs are allocated using the net realizable value at split-off approach, what joint costs are allocated to each of the joint products DF1 and DF2 and to the by-product, BP?
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Denver Fabricators manufactures products DF1 and DF2 from a joint process, which also yields a by-product, BP. The company accounts for the revenues from its by-product sales as other income. Additional information follows: DF1 DF2 BP Total Units produced 27,000 18,000 15,000 60,000 Allocated joint costs ? ? ? $ 560,000 Sales value at split-off $ 561,000 $ 187,000 $ 102,000 $ 850,000 Required: Assuming that joint product costs are allocated using the net realizable value at split-off approach, what joint costs are allocated to each of the joint products DF1 and DF2 and to the by-product, BP?
The following information relates to a joint production process for three products, with a total joint production cost of $165,000. There are no separable processing costs for any of the three products. Product 1 2 Sales Value at Split-Off $ 181,500 Product 1 2 3 99,000 49,500 $ 330,000 Assume that the total sales value at the split-off point for product 1 is $66,000 instead of $181,500 and the sales value of product 3 is $3,300 instead of $49,500. Assume also that the firm treats product 3 as a joint product and uses the net realizable value method for accounting for joint costs. There are no separable processing costs for product 3. What amount of joint costs would be allocated to the three products using the relative sales value method? (Round your intermediate percentage values to 2 decimal places (i.e. 24.35%) and final answers to nearest whole dollar amount.) Units at Split-Off 320 960 1,920 3,200 Allocated Joint Cost