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    CHAPTER-14 Cost10

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    Louiza Kyla Arida
    This document contains two accounting problems involving inventory valuation and allocation of joint costs. Problem 14-4 compares recognizing revenues and costs of a product at the time of production versus the time of sale. It involves calculating inventory amounts and cost of goods sold. Problem 14-5 allocates a joint cost of P300,000 among three products based on their sales values at the split-off point, then calculates the total and per unit costs for each product.

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    CHAPTER-14 Cost10

    Uploaded by

    Louiza Kyla Arida
    27 views1 page
    This document contains two accounting problems involving inventory valuation and allocation of joint costs. Problem 14-4 compares recognizing revenues and costs of a product at the time of production versus the time of sale. It involves calculating inventory amounts and cost of goods sold. Problem 14-5 allocates a joint cost of P300,000 among three products based on their sales values at the split-off point, then calculates the total and per unit costs for each product.

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    CHAPTER-14 cost10

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    This document contains two accounting problems involving inventory valuation and allocation of joint costs. Problem 14-4 compares recognizing revenues and costs of a product at the time of production versus the time of sale. It involves calculating inventory amounts and cost of goods sold. Problem 14-5 allocates a joint cost of P300,000 among three products based on their sales values at the split-off point, then calculates the total and per unit costs for each product.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    27 views1 page

    CHAPTER-14 Cost10

    Uploaded by

    Louiza Kyla Arida
    This document contains two accounting problems involving inventory valuation and allocation of joint costs. Problem 14-4 compares recognizing revenues and costs of a product at the time of production versus the time of sale. It involves calculating inventory amounts and cost of goods sold. Problem 14-5 allocates a joint cost of P300,000 among three products based on their sales values at the split-off point, then calculates the total and per unit costs for each product.

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    © All Rights Reserved
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    Download as doc, pdf, or txt
    of 1

    1

    Problem 14-4

    1. a. Recognized b. Recognized
    at Production at Sale
    Revenues:
    Main Product P1,600,000 (a) P1,600,000
    By-product 0 28,000 (d)
    Total revenues 1,600,000 1,628,000
    Cost of goods sold:
    Manufacturing costs 1,200,000 1,200,000
    Less by-product revenue 40,000 (b) 0
    Net manufacturing costs 1,160,000 1,200,000
    Less main product inventory 232,000 (c) 240,000 (e)
    Cost of goods sold 928,000 960,000
    Gross profit P 672,000 P 668,000

    (a) 16,000 x P200


    (b) 4,000 x P20
    (c) 2,000/10,000 x P1,160,000 = P232,000
    (d) 1,400 x P20
    (e) 2,000/10,000 x P1,200,000 = P240,000

    2. Recognized Recognized
    at production at Sale
    Coke P232,000 P240,000
    Pepse 12,000 (a) 0

    (a) Ending inventory shown at unrealized selling price.

    BI + Production - Sales -= EI
    0 + 2,000 - 1,400 = 600 gallons

    Ending inventory = 600 x P20 = P12,000/

    Problem 14-5

    1. Allocation of Joint Costs of P300,000.

    a. Sales value at splitoff point method


    Narra A Narra B Narra C Total
    Sales value at splitoff:
    (30,000 x P8) P240,000 )
    (50,000 x P4) P200,000 )
    (20,000 x P3) P60,000 ) P500,000
    Ratio: (240/500); (200/500); (60/500) 48% 40% 12%
    Allocated joint costs, (48%;40%;12%) P144,000 P120,000 P36,000 P300,000
    Total costs:
    Joint costs P144,000 P120,000 P36,000 P300,000
    Separable processing costs 60,000 90,000 15,000 165,000
    Total costs P204,000 P210,000 P51,000 P465,000
    Divided by total production ÷ 25,000 ÷ 40,000 ÷15,000
    Cost per board foot P 8.16 P 5.25 P 3.40

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