Question
Two types of plastic piping are produced in a joint production process. UB-1 may be sold immediately after split-off. UB-2 requires further processing before it
Two types of plastic piping are produced in a joint production process. UB-1 may be sold immediately after split-off. UB-2 requires further processing before it is ready for sale. There is no opening inventory. The following production data are available:
Total joint cost K80 000
Additional cost of processing UB-2 K38 400
| Sales quantity (metres) | sales price (metres) | closing inventory (metres) |
| UB-1 200 000 | K0.30 | 8 000 |
| UB-2 180 000 | K0.40 | 12 000 |
Required:
a). calculate the cost of closing inventory using the final sales revenue method of joint cost
allocation to the nearest K100. (5 Marks)
Joint products Output (kg) Selling price per kg
- 5 000 K10
- 10 000 K4
- 10 000 K3
Joint costs are K100 000
Required:
b). calculate the profit per unit after apportioning joint costs on the basis of physical quantity for
each product (10 Marks)
c). calculate the total profits of all products after apportioning joint costs on the basis of sales value.
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Cost Management Accounting And Control
Authors: Don R. Hansen, Maryanne M. Mowen
3rd Edition
0324002327, 978-0324002324
