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The Alfarm Company created two joint products (Cream, Liquid Skim) and two by-products (Buttermilk and Condensed Milk) at a joint cost of P150,000. Additional Info:
The Alfarm Company created two joint products (Cream, Liquid Skim) and two by-products (Buttermilk and Condensed Milk) at a joint cost of P150,000. Additional Info: Units Produced Sales Value at split off Sales Value if processed Further Further processing cost per unit Cream 20,000 13.20 17.00 5.00 Liquid Skim 10,000 11.60 14.00 4.00 Buttermilk 1,500 3.00 6.00 1.00 Condensed Milk 3,000 4.00 7.00 2.00 Selling and admin expense per unit 2 2 2 2 Operating profit per unit 1 1 1 Show complete solution on how to compute unit cost of joint products using: A. Market value at split off method When joint production costs are allocated to buttermilk and condensed using: 1. Net realizable method 2. Reversal cost method B. Net realizable value method When joint production costs are allocated to buttermilk and condensed using: 3. Net realizable method 4. Reversal cost method
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