Collie Company has a joint process that produces three products: R, D and A. Each product may be sold at split-off or processed further and then sold. Joint processing costs for a year amount to $300,000. Other relevant data are as follows: Product Sales Value Costs after Sales Value at Split-Off Split-Off at Completion $ $ $ R 120,000 260,000 420,000 D 80,000 140,000 190,000 A 150,000 190,000 350,000 Required: Using incremental analysis determine which products should be sold at split-off point and which should be processed further.

Collie Company has a joint process that produces three products: R, D and A. Each product may be sold at split-off or processed further and then sold. Joint processing costs for a year amount to $300,000. Other relevant data are as follows: Product Sales Value Costs after Sales Value at Split-Off Split-Off at Completion $ $ $ R 120,000 260,000 420,000 D 80,000 140,000 190,000 A 150,000 190,000 350,000 Required: Using incremental analysis determine which products should be sold at split-off point and which should be processed further.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter6: Process Cost Accounting—additional Procedures; Accounting For Joint Products And By-products

Section: Chapter Questions

Problem 13P: Venezuela Oil Inc. transports crude oil to its refinery where it is processed into main products...

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Collie Company has a joint process that produces three products: R, D and A. Each product may be sold at split-off or processed further and then sold. Joint processing costs for a year amount to $300,000. Other relevant data are as follows: Product Sales Value at Split off Costs after Split off Sales Value At Completion $ $ $ R 120,000 260,000 420,000 D 80,000 $140,000 190,000 A 150,000 $190,000 350,000 Required: Determine total net income if all products are sold at split-off point. 2. Determine total net income if all products are sold after processing. 3. Using incremental analysis determine which products should be sold at split-off point and which should be processed further
Your Corporation produces products P, Q, and R from a joint production process. Each product may be sold at the split-off point or processed further. Joint production costs of $80,000 per year are allocated to the products based on the relative number of units produced. Which products should be processed further? P Q R Units produced 3,000 6,000 1,000 Selling price at split off $37,500 $46,500 $15,500 Cost to process further $10,000 $30,000 $5,000 Selling price after processing $50,000 $65,000 $25,000 a. P, Q and R b. P and Q c. Just P d. P and R e. Just Q
CUIK-983 company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $75,000 per quarter. The company allocates these costs to the Joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Product Selling Price Quarterly Output 10,000 pounds A $ 5 per pound B $ 6 per pound 22,000 pounds C $ 14 per gallon 5,000 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below: Additional Product Processing Costs Selling Price A $ 53,000 B $ 38,000 C $ 18,000 Which products should be processed further? Multiple Choice Multiple Choice B and C A and C A, B, and C A and B $ 7 per pound $ 11 per pound $20 per gallon
Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $45,500 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below: Product X Product Y Total Allocated joint processing costs $27,300 $ 18,200 $ 45,500 Sales value at split-off point $ 30,000 $20,000 $50,000 Costs of further processing $ 24,200 $ 18,500 $ 42,700 Sales value after further processing $ 47,800 $58,300 $ 106,100 Required: a. What is financial advantage (disadvantage) of processing Product X beyond the split-off point? (Negative amount should be indicated by a minus sign.) b. What is financial advantage (disadvantage) of processing Product Y beyond the split-off point? c. What is the minimum amount the company should accept for Product X if it is to be sold at the split-off point? d.…
ats Assume a company has three products-A, B, and C-that emerge from a joint process. The joint processing costs that are incurred up to the split-off point equal $1,200,000. The selling prices and outputs for each product at the split-off point are as follows: Product A B С Selling Price $33 per pound $29 per pound $24 per pound Product A B C Each product can be processed further beyond the split-off point. The additional processing costs for each product and their respective selling prices after further processing are as follows: Output 14,000 pounds 18,000 pounds 19,000 pounds Additional Processing Costs $65,000 $72,000 $88,000 Selling Price $37 per pound $34 per pound $30 per pound The company is trying to decide whether to retain or discontinue the entire joint manufacturing process. What is the financial advantage (disadvantage) of continuing to operate the entire joint manufacturing process?
CUIK-649 company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $75,000 per quarter. The company allocates these costs to the joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Product Selling Price Quarterly Output 10,000 pounds A $ 4 per pound B $ 6 per pound 22,000 pounds с $ 10 per gallon 5.000 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below: Additional Product Processing Costs Selling Price A $ 53.000 $ B $ 38,000 $ с $ 18,000 $ Which products should be processed further? Multiple Choice O O O A and B A and C B and C AR and C 7 per pound 12 per pound 19 per gallon
Y Company produces two joint products: Sweet and Sour. Joint cost is allocated using the net realizable value method at split-off point. Joint production cost is $70,000. Neither product is salable at split-off point. During May, the additional costs incurred beyond split-off point are as follows: Sweet $ 32,000 Sour $ 48,000 Production: Sweet: 3,200 units Sour: 1,600 units Selling prices: Sweet: $50.00 per unit Sour: $ 90.00 per unit What is the amount of joint cost allocated to Sweet and Sour using the NRV Method at split-off point. (Must show calculations or no credit) Joint cost allocated to Sweet: $_____________________________ Joint cost allocated to Sour:…
Johnson Company makes two products: Carpet Kleen and Floor Deodorizer. Operating information from the previous year follows.Carpet Kleen Floor DeodorizerUnits produced and sold 5,000 4,000Machine hours used 5,000 2,000Sales price per unit P7 P10Variable cost per unit P4 P8Fixed costs of P20,000 per year are presently allocated equally between both products. If the product mix were to change, total fixed costs would remain the same. 13. Assuming there is unlimited demand for both products and Johnson has 10,000 machine hours available, how many units of each product should be produced and sold?Carpet Kleen Floor DeodorizerA. 0 units 0 units B. 0 units 20,000 units C. 5,000 units 10,000 units D. 8,000 units 4,000 units
The Fox Corporation produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the split-off point for total annual revenues of $50,000, or it can be processed further at a total annual cost of $16,000 and then sold for $68,000. Which of the following statements is true concerning Product Y? O Product Y should be sold at the split-off point rather than processed further. O The annual financial advantage from processing Product Y further is $18,000. O The annual financial advantage from processing Product Y further is $68,000. O The annual financial advantage from processing Product Y further is $2,000.
How much is the net income attributable to Product M, assuming that joint costs are allocated using the Approximate Net Realizable Value x, and after being processed further, 1,800 gallons of Product M was sold during the year? TVA Company produces three products from the same process and incurs joint processing costs of P150,000. Sales price per gallon at split-off Disposal cost per gallon at split-off P 62.50 Final sales price per gallon P350.00 Gallons Further processing costs P 50.00 2,400 1,100 M P225.50 N 300 150.00 100.00 500.00 500 500 400.00 100.00 750.00 Disposal costs for the products if they are processed further are: M, P 150.00; N, P 275.00; Q, P 50.00.
Assume a company has two products-A and B-that emerge from a joint process. A total of 2,000 units of Product A are produced from the joint process. Product A can be sold at the split-off point for $16 per unit, or it can be processed further for an additional total cost of $16,000 and then sold for $25 per unit. What is the incremental revenue earned by further processing Product A? Multiple Choice $18,000 $8,000 $4,000 $2,000
Stahl Inc. produces three separate products from a common process costing $100,300. Each of the products can be sold at the split-off point or can be processed further and then sold for a higher price. Shown below are cost and selling price data for a recent period. Sales Valueat Split-OffPoint Cost toProcessFurther Sales Valueafter FurtherProcessing Product 10 $59,400 $100,900 $190,100 Product 12 15,000 30,100 34,000 Product 14 55,600 149,400 215,900