Product |
||||
A |
B |
X |
Total |
|
Units produced |
15,000 |
9,000 |
6,000 |
30,000 |
Joint costs |
? |
? |
? |
$200,000 |
Sales value at split off |
$392,000 |
$168,000 |
$20,000 |
$580,000 |
(1) Assuming that joint product costs are allocated using the relative sales value at split-off approach, what was the joint cost allocated to Products A and B?
(2) Prepare the journal entry to transfer the finished products (Products A and B) to separate inventory accounts.
(3) Assuming the sales value of X is stable, prepare the journal entries to:
(a) place the by-product in stock
(b) record the sale of 3,000 units for $11,500 on account.
ANS:
(1)
(2)
(3)
(a)
(b)
Question 1 | |||||
A | B | X | Total | ||
A | Sales Value at splitoff | $ 3,92,000.00 | $ 1,68,000.00 | $ 20,000.00 | |
B | Joint Cost | $ 2,00,000.00 | |||
C | Joint Cost to be allocated | $ 1,80,000.00 | |||
D | Joint cost allocation on the basis of value of splitoff | $ 1,26,000.00 | $ 54,000.00 | $ - | $ 1,80,000.00 |
Question 2
Finished Goods A $126,000
Finished Goods B $54,000
Work-in-process inventory $180,000
Question 3a
Finished Goods $120,000
Work in process inventory $120,000
Question 3b
Accounts recivable $11,500
Cost of goods sold $11,500
Inventory $11,500
Sales $11,500
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