s joint products
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question

Transcribed Image Text:No. 1
The following is relevant for a production process for Period 1:
Direct material cost
$10,000
Direct labour cost
$5,000
Overheads
$3,000
Total costs
$18,000
The process produces joint products A and B, which are then sold at the
prices given below. The output figure represents all of the output from the
process:
Product A
Product B
Units of output
2,000
8,000
Price per unit
$5
$2.50
Required:
Calculate the cost of sales, and gross profit for products A and B
assuming:
(i) joint costs are apportioned by market value
(ii) joint costs are apportioned by production units.
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