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    Psba Afar 13

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    Psba Afar 13

    Uploaded by

    sapilanfrancene
    1 views2 pages
    AFAR REVIEWER

    Original Title

    PSBA AFAR 13

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    1 views2 pages

    Psba Afar 13

    Uploaded by

    sapilanfrancene
    AFAR REVIEWER

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    © All Rights Reserved
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    of 2

    UNIT 13: JOINT AND BY-PRODUCTS

    Problem 1.
    Donna Company produces four joint products, which have a manufacturing cost of P18,000 at the split-off point. Data
    pertaining to these products are as follows:
    Product Units of Estimated Market Value Weight Points
    Production Per Unit Per Unit Assigned
    A 500 P40 4 kgs. 5 points
    B 300 60 10 kgs. 9 points
    C 200 35 5 kgs. 4 points

    Required: Allocate the joint production costs using:


    1. Market value method
    2. Average unit cost method
    3. Weighted average method
    4. Quantitative method

    Problem 2.
    The Meadows Company produced three joint products at a joint cost of P132,000. Additional information for a recent period
    is as follows:
    If processed further
    Sales
    Units Value at Additional
    Product Produced SO Sales value costs
    A 13,200 P88,000 P121,000 P19,800
    B 8,800 77,000 99,000 15,000
    C 4,400 55,000 66,000 11,000

    Required: Allocate joint cost and compute for the total cost using:
    1. Physical units
    2. Sales value at split-off

    Problem 3.
    The UNIOIL Company buys crude, vegetable oil. The refining process of this material results in four (4) products, namely
    A, B, C, and D. A, B, and C are liquids, while D is a heavy grease. The cost of the oil refined in 2010 was P27,600 and total
    processing costs of P70,000 was also incurred. The output and sales for the four products in 2016 were as follows:
    Product Output Sales Processing costs
    A 500,000 gals P115,000 P30,000
    B 10,000 10,000 6,000
    C 5,000 4,000 -
    D 9,000 30,000 1,000

    Required:
    (1) Assume the net realizable value method of allocating joint cost is used. What is the gross profit for Product A,
    B, C, and D?
    (2) The Company is also looking at the option of selling all the products to other processors at the split off point.
    Under this alternative, sales per gallon will be A, P0.15; B, P0.50; C, P0.80, and D, P3. What would be the gross
    profit for each product if this alternative is selected?

    Problem 4

    Below are production and sales data for three products. Joint costs amounted to P35,000.
    Product Qty. Selling Cost after Qty.
    produced price split-off sold
    M 1,500 P10.00 P3,000 1,200
    N 2,500 12.00 2,000 2,000
    O 1,000 15.00 5,000 800

    Required: Compute the cost of goods sold, gross profit, and value of ending inventory for each product using the sales
    value method.
    Problem 5
    Darvin Corporation manufactures joint products X and Y as well as by-product A. Cumulative joint cost data for the period
    show P204,000, representing 20,000 completed units processed through the Refining Department. Costs are assigned to
    X and Y by the market value method, which considers further processing costs in subsequent operations. To determine
    the cost allocation to A, the market value (reversal cost) method is used. Additional data:

    A X Y
    Quantity processed 2,000 8,000 10,000
    Sales price per unit P6.00 P20.00 P25.00
    Further processing cost per
    unit 2.00 5.00 7.00
    Marketing & Adm. Expense
    per unit 1.00
    Desired profit per unit 1.00

    Required:
    1. Compute the joint cost allocated to A
    2. Allocate the remaining joint cost to X and Y

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