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 123 Sales Value at Split-Off $ 252,000 Units at Split-Off 350 72,000 1,050 36,000 2,100 $ 360,000 3,500 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 the asset recognition 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? Product Allocated Joint Cost 1 2 3
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 123 Sales Value at Split-Off $ 252,000 Units at Split-Off 350 72,000 1,050 36,000 2,100 $ 360,000 3,500 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 the asset recognition 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? Product Allocated Joint Cost 1 2 3
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Vishnu
Transcribed Image Text: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
123
Sales Value at
Split-Off
$ 252,000
Units at
Split-Off
350
72,000
1,050
36,000
2,100
$ 360,000
3,500
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 the asset recognition 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?
Product
Allocated Joint
Cost
1
2
3
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