Question
1. When two products are produced during a common process, what is the factor that determines whether the products are joint products or one principal
1.
When two products are produced during a common process, what is the factor that determines whether the products are joint products or one principal product and a by-product?
-relative total sales value of the products
-amount of additional work expended in the production of each product
-management policy
-relative size of the products
2. A company has sales of $40,000 and COGS of $21,000 on their primary product during January. A by-product, with a net sales value of $800, is produced during January as well. Sales of the by-product totaled $400 in revenue for January. If a production method (net realizable value option) of accounting for by-products is used, the gross profit for the month would equal __________.
3. A company has sales of $40,000 and COGS of $21,000 on their primary product during January. A by-product, with a net sales value of $800, is produced during January as well. Sales of the by-product totaled $400 in revenue for January. If a sales method (manufacturing cost recovery option) of accounting for by-products is used, the gross profit for the month would equal __________.
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