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Question 5 Telsa Limited manufactures two products (AE and XP) through a joint process. Both products can be sold immediately after split-off. There are no
Question 5
Telsa Limited manufactures two products (AE and XP) through a joint process. Both products can be sold immediately after split-off. There are no opening inventories or work in progress. The following information is available for last period:
Total joint production costs $1,164,240
Product | Production units | Sales units | Selling price per unit |
AE | 18,000 | 15,000 | $15.00 |
XP | 15,000 | 12,000 | $18.00 |
Required:
Using the sales value method of apportioning joint production costs,
- Distinguish between joint products and byproducts and give an example of each. [4 marks]
- Compute costs that will be allocated to product AE and XP [5 marks]
- Calculate value of closing inventory for AE and XP [3 marks]
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