Question
3.1. A business produces two main line products using the same material. The normal wastage arising from this project is processed further and is sold
3.1. A business produces two main line products using the same material. The normal wastage arising from this project is processed further and is sold as a by-product. The following information relates to the activities of the business in its next financial year: Production Sales price (Kilograms) (per kg.) Product X 70 000 2 Product Y 50 000 1, 25 By-product Z 15 000 0, 55 Additional information: Joint production cost - R100 000 Cost of processing by-product further - R0, 15 per kg No opening and closing stock No joint costs are allocated to the by-product The net proceeds from the sale of the by-product are deducted from the joint cost The joint costs are divided between products X and Y on the basis of potential market value Page 4 of 4 Required: Calculate the gross profit of products X and Y individually (203.1. A business produces two main line products using the same material. The normal wastage arising from this project is processed further and is sold as a by-product. The following information relates to the activities of the business in its next financial year: Production Sales price (Kilograms) (per kg.) Product X 70 000 2 Product Y 50 000 1, 25 By-product Z 15 000 0, 55 Additional information: Joint production cost - R100 000 Cost of processing by-product further - R0, 15 per kg No opening and closing stock No joint costs are allocated to the by-product The net proceeds from the sale of the by-product are deducted from the joint cost The joint costs are divided between products X and Y on the basis of potential market value Page 4 of 4 Required: Calculate the gross profit of products X and Y individually (203.1. A business produces two main line products using the same material. The normal wastage arising from this project is processed further and is sold as a by-product. The following information relates to the activities of the business in its next financial year: Production Sales price (Kilograms) (per kg.) Product X 70 000 2 Product Y 50 000 1, 25 By-product Z 15 000 0, 55 Additional information: Joint production cost - R100 000 Cost of processing by-product further - R0, 15 per kg No opening and closing stock No joint costs are allocated to the by-product The net proceeds from the sale of the by-product are deducted from the joint cost The joint costs are divided between products X and Y on the basis of potential market value Page 4 of 4 Required: Calculate the gross profit of products X and Y individually (203.1. A business produces two main line products using the same material. The normal wastage arising from this project is processed further and is sold as a by-product. The following information relates to the activities of the business in its next financial year: Production Sales price (Kilograms) (per kg.) Product X 70 000 2 Product Y 50 000 1, 25 By-product Z 15 000 0, 55 Additional information: Joint production cost - R100 000 Cost of processing by-product further - R0, 15 per kg No opening and closing stock No joint costs are allocated to the by-product The net proceeds from the sale of the by-product are deducted from the joint cost The joint costs are divided between products X and Y on the basis of potential market value Page 4 of 4 Required: Calculate the gross profit of products X and Y individually (20
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