Nate Company manufactures Products A and B from a joint process that also yields
ID: 2460676 • Letter: N
Question
Nate Company manufactures Products A and B from a joint process that also yields a by-product, X. Nate Company accounts for the revenue from its by-product sales as a deduction from the cost of its main products. Additional information is as follows:
Product
A
B
Total
Units produced
15,000
9,000
24,000
Joint costs
?
?
$180,000
Sales value at split off
$402,000
$178,000
$580,000
1. Assuming that joint product costs are allocated using the relative sales value at split-off approach, what was the joint cost allocated to Products A and B?
Product
A
B
Total
Units produced
15,000
9,000
24,000
Joint costs
?
?
$180,000
Sales value at split off
$402,000
$178,000
$580,000
Explanation / Answer
Product A B Total Sales value at split off 4,02,000 1,78,000 5,80,000 Percent sales value 69.31% 30.69% 100.00% Joint Cost Allocated percent of sales value 124759 55241 180000
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