31. Garage Specialty Corporation manufactures joint products P and Q. During a recent period, joint costs...
31.
Garage Specialty Corporation manufactures joint products P and
Q. During a recent period, joint costs amounted to $105,000 in the
production of 46,000 gallons of P and 81,000 gallons of Q. Garage
can sell P and Q at split-off for $2.40 per gallon and $4.60 per
gallon, respectively. Alternatively, both products can be processed
beyond the split-off point, as follows:
| P | Q | |
| Separable processing costs | $39,000 | $59,000 |
| Sales price (per gallon) if processed beyond split-off | $3 | $5 |
The joint cost allocated to Q under the relative-sales-value method would be: (Do not round your intermediate calculations.)
Multiple Choice
$23,571.
$81,000.
$73,636.
$75,236.
None of these.
32. Garage Specialty Corporation manufactures joint products P
and Q. During a recent period, joint costs amounted to $105,000 in
the production of 46,000 gallons of P and 81,000 gallons of Q.
Garage can sell P and Q at split-off for $2.40 per gallon and $4.60
per gallon, respectively. Alternatively, both products can be
processed beyond the split-off point, as follows:
| P | Q | |
| Separable processing costs | $39,000 | $59,000 |
| Sales price (per gallon) if processed beyond split-off | $3 | $5 |
The joint cost allocated to P under the relative-sales-value method would be: (Do not round your intermediate calculations.)
Multiple Choice
$24,000.
$31,764.
$13,929.
$125,200.
None of these.
Homework Answers
31. The correct answer is option B $81000
According relative sales value method. Joint cost is allocated on the basis of total sales value of product.
Sales value of P = sales price * sales unit
46000*$2.40 = $110400
Sales value of Q= $81000*$4.60=$372600
Joint cost allocation to product Q= (joint cost * sales value of Q)÷ (Total sales value of P + total sales value of Q)
($105000*$372600)÷($110400 + 372600)= $81000
32. The correct option is A $24000
The same method can be followed as above discussed .
( Joint cost*sales value of product P)÷(Total sales value of product P + total sales value of product Q)
($105000*$110400)÷($110400+$372600)= $24000
Add Answer to:
31.
Garage Specialty Corporation manufactures joint products P and
Q. During a recent period, joint costs...
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