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Cost Management: A Strategic Emphasis 5th Edition by David Stout, Edward Blocher, Gary Cokins
Edition 5ISBN: 0073526940Cost Management: A Strategic Emphasis 5th Edition by David Stout, Edward Blocher, Gary Cokins
Edition 5ISBN: 0073526940Joint Products
Bravo Company produces joint products J, K, and B from a joint process. This information concerns a batch produced in April at a joint cost of $60,000:
|
| After Split-Off | |
Product | Units Produced and Sold | Total Additional Costs | Total Final Sales Value |
J | 1,000 | $10,000 | $90,000 |
K | 2,000 | 10,000 | 50,000 |
B | 4,000 | 5,000 | 10,000 |
Required How much of the joint cost should be allocated to each joint product using the net realizable value method?
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Step 1 of 4
Joint Costs
Often companies produce more than one product in one single process and thus the costs of the processes are known as joint costs. Joint costs include all the costs including direct material, direct labour and overheads of the company. Joint costs are allocated among the joint products and not the by-products as they are only incidental to the process.
Step 2 of 4
Step 3 of 4
Step 4 of 4
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