Two products G and H are created from a joint process. G can be sold immediately after split-off. H requires further processing before it is in a saleable condition. There are no opening inventories and no work in progress. The following data are available for last period: $ Total joint production costs 384,000 Further processing costs (product H) 159,600 Product Selling price Sales Production per unit Units Units G $0.84 400,000 412,000 H $1.82 200,000 228,000 Using the physical unit method for apportioning joint production costs, what was the cost value of the closing inventory of product H for last period?
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Two products G and H are created from a joint process. G can be sold immediately after split-off. H
requires further processing before it is in a saleable condition. There are no opening inventories and no
work in progress. The following data are available for last period:
$
Total joint production costs 384,000
Further
Product Selling price Sales Production
per unit Units Units
G $0.84 400,000 412,000
H $1.82 200,000 228,000
Using the physical unit method for apportioning joint production costs, what was the cost value of the
closing inventory of product H for last period?
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