National Furniture Showroom makes building material from timber land in Gujrat City. They bought =1,00,000/- Rs worth of timber wood for furniture manufacturing . The
National Furniture Showroom makes building material from timber land in Gujrat City. They bought =1,00,000/- Rs worth of timber wood for furniture manufacturing . The timber also costs the business =10,000/- as a transportation charges. And =5,000/- Rs paid to labor for loading and unloading timber wood. After splitting off the lumber and plywood (to build new homes) is expecting the high sales value while the wood grains have a low sales value. The showroom manager is of the view that the business has to assign the separable processing cost of Rs=14000/- to lumber and Rs=18,000/- to plywood. Then business sold the lumber to Talha limited =70,000/- and plywood to Nasir limited to =80,000/-. The wood grains are also sold to Ali & Co for =2500/- Rs. On the basis of the above data Allocate joint costs to products based on the Net Realizable value Method? (3 Marks) Q NO 19: On the basis of the data available in Q No 18, how will you treat the proceeds from wood grains in your accounting? What will be your opinion about the situation if wood grains has a separable processing cost of =700/- ?
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