S-T Inc. processes material in 1,000-litre batches. Each batch results in 400 L of main product X,
Question:
S-T Inc. processes material in 1,000-litre batches. Each batch results in 400 L of main product X, 500 L of main product Y, and 100 L of by-product Z. Material is added at the start of the process. The joint products emerge at the end of the process. By-product revenues are treated as a reduction of joint costs at the time of production. Joint costs are assigned to main products using the net realizable value method. Product X sells for $8/L and has separable costs of $2/L. Product Y sells for $11/L and has separable costs of $3/L. By-product Z sells for $1/L.
The beginning inventory consists of two batches averaging 30% and 80% complete. Material costs are $8,550, and conversion costs are $3,007. The ending inventory consists of one batch, which is 50% complete. During the week, 20 batches were completed and transferred out. Materials placed into production had a cost of $71,250, and conversion costs totalled $40,470.
REQUIRED:
Using the weighted-average process costing method, what is the unit cost to be assigned to each of the completed products X, Y, and Z?
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Cost Management Measuring, Monitoring And Motivating Performance
ISBN: 1601
3rd Canadian Edition
Authors: Leslie G. Eldenburg, Susan K. Wolcott, Liang Hsuan Chen, Gail Cook