1.Red Horse, Inc. a small beer brewery. The beer is processed in a single brewery into light beer, dark beer, and an impure byproduct. There were no beginning inventories or work-in-process on December. The production costs of Red Horse, Inc. for December are presented below:

Costs:

Materials acquired and placed in production P 5,000,000

Direct labor2,000,000

Factory overhead3,000,000

Production and sales information:

a.Light beer 300,000 cases produced; 80,000 cases sold at P 20 each.

b.Dark beer 240,000 cases produced; 120,000 cases sold at P 15 each.

c. Impure byproduct 120,000 cases produced and sold at P 15 each.

Requirement:

1.The portion of joint production costs assigned to light beer based on the relative sales value of output would be?

a.P 4,800,000

b.P 4,000,000

c.P 2,500,000

d.P 2,286,000