Question 1

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of processing pulp into paper.

Accepted Answer

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Question 2

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of raw tomato processing, tomatoes are to be used for different soups in a soup plant.

Accepted Answer

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Question 3

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of processing lumber into different lengths and sizes at a sawmill.

Accepted Answer

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Question 4

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Fuel oil from petroleum processing

Accepted Answer

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Question 5

A business which enters into a contract to purchase a product (or products)and will compensate the manufacturer under a cost reimbursement formula, should take an active part in the determination of how joint costs are allocated because
A)it is important in the understanding of the cause-and-effect relationship.
B)if the manufacturer successfully allocates a large portion of its costs to these products then it will be able to sell its other nonreimbursed products at lower prices.
C)the ASPE/IFRS requires the business to participate in the cost allocation process.
D)they are used in the calculation of the suppliers inventoriable costs.
E)sales discounts often depend on joint cost allocation amounts.

Accepted Answer

The business should take an active part in the determination of joint cost allocation because if the manufacturer allocates a large portion of its costs to the reimbursed products, it can sell its other nonreimbursed products at lower prices, potentially affecting the business's competitive position.

Question 6

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of processing water into different sized bottles for human consumption.

Accepted Answer

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Question 7

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Raw milk for dairy processing

Accepted Answer

The answer of Match each of the following costs with...

Question 8

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Broth from cooking food

Accepted Answer

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Question 9

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of processing timber (trees)at a sawmill.

Accepted Answer

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Question 10

Which of the following is NOT a reason underlying the importance of allocations for inventory costing and cost of goods sold computations?
A)Inventory costing is essential for proper balance sheet presentation.
B)Divisional profitability may affect compensation for divisional managers.
C)Cost of goods sold is an important component in the determination of net income.
D)The information may be required for insurance settlement or litigation.
E)Sell work-in -process or process further decisions prior to the splitoff point.

Accepted Answer

Choice E is not a reason underlying the importance of allocations for inventory costing and cost of goods sold computations. The other choices all highlight important reasons for accurate cost allocation, including the proper presentation of inventory on the balance sheet, the impact on divisional profitability and compensation, the contribution to the calculation of net income, and the potential need for the information in insurance or litigation scenarios.

Question 11

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of processing crude oil in a gasoline refinery.

Accepted Answer

The answer of Match each of the following costs with...

Question 12

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of moulding plastic for use in making different toys on an assembly line.

Accepted Answer

The answer of Match each of the following costs with...

Question 13

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Bones from a butcher shop

Accepted Answer

The answer of Match each of the following costs with...

Question 14

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Sawdust from a furniture manufacturer

Accepted Answer

The answer of Match each of the following costs with...

Question 15

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Salt from a salt works process

Accepted Answer

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Question 16

Assigning joint costs when only a portion of a business's products are sold to a single customer is an example of which of the following?
A)inventory costing for external financial statements
B)customer profitability analysis
C)rate regulation requirements
D)price regulation
E)cost reimbursement

Accepted Answer

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Question 17

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of canning soup in a soup plant.

Accepted Answer

The answer of Match each of the following costs with...

Question 18

Match each of the following costs with the appropriate joint production process cost classification.
A)scrap
B)joint product
C)byproduct
D)main product
-Sawdust from a sawmill

Accepted Answer

The answer of Match each of the following costs with...

Question 19

Match each of the following costs with the appropriate joint production process cost classification.
A)separable cost
B)joint cost
-Cost of refining gasoline for use in automobiles.

Accepted Answer

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Question 20

Which of the following is TRUE regarding the costs of toxic waste disposal, reclamation, and remediation that result from joint production processing?
A)Toxic waste costs are treated in the same manner byproduct costs.
B)Disposal costs should be expensed, other costs charged to cost of goods sold.
C)The costs should be valued in inventory at net realizable value.
D)Toxic waste costs are a life-cycle cost that should be added to joint production costs prior to allocation.
E)All toxic waste costs should be expensed as do not form part of the product.

Accepted Answer

Toxic waste costs are a life-cycle cost that should be added to joint production costs prior to allocation. This means that the costs should be included in the overall cost of producing the joint products, and then allocated to each product based on their respective sales values. This approach ensures that each product bears a fair share of the toxic waste costs associated with joint production.

Quiz 15: Cost Allocation: Joint Products and Byproducts

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of processing pulp into paper.

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of raw tomato processing, tomatoes are to be used for different soups in a soup plant.

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of processing lumber into different lengths and sizes at a sawmill.

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Fuel oil from petroleum processing

A business which enters into a contract to purchase a product (or products) and will compensate the manufacturer under a cost reimbursement formula, should take an active part in the determination of how joint costs are allocated because

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of processing water into different sized bottles for human consumption.

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Raw milk for dairy processing

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Broth from cooking food

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of processing timber (trees)at a sawmill.

Which of the following is NOT a reason underlying the importance of allocations for inventory costing and cost of goods sold computations?

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of processing crude oil in a gasoline refinery.

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of moulding plastic for use in making different toys on an assembly line.

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Bones from a butcher shop

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Sawdust from a furniture manufacturer

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Salt from a salt works process

Assigning joint costs when only a portion of a business's products are sold to a single customer is an example of which of the following?

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of canning soup in a soup plant.

Match each of the following costs with the appropriate joint production process cost classification. A)scrap B)joint product C)byproduct D)main product -Sawdust from a sawmill

Match each of the following costs with the appropriate joint production process cost classification. A)separable cost B)joint cost -Cost of refining gasoline for use in automobiles.

Which of the following is TRUE regarding the costs of toxic waste disposal, reclamation, and remediation that result from joint production processing?