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cHAPTER 11
cHAPTER 11
TRUE/FALSE
1. T 6. T 11. T
2. F 7. T 12, F
3. F 8. F 13. T
4. T 9. T 14. T
5. T 10.T 15. F
Page 2
Problem 3 Anchor Company
1. Market value method
Product SV at SO Percentage Share in JC Addl Cost Total Cost
A 420,000 60% 252,000 88,000 340,000
B 270,000 162,000 30,000 192,000
C 60,000 36,000 12,000 48,000
450,000 130,000 580,000
2. Average unit cost method
Product Units Produced Ave UC Share in JC Addl Cost Total Cost
A 50,000 4.50 225,000 88,000 313.000
B 40,000 180,000 30,000 210,000
C 10,000 45,000 12,000 57,000
450,000 130,000 580,000
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c) Revenue from by-product shown as other income
Sales
Main product 180,000
Less: Cost of goods sold
Materials 30,000
Labor 17,400
Overhead 17,400
Cost of goods manufactured 64,800
Less: Inventory, end 6,480
Cost of goods sold 58,320
Gross profit 121,680
Less: Selling and administrative expenses 54,000
Net operating icome 67,680
Other income Revenue from by-product 1,000
Net Income 68,680
2. Revenue from by-product shown as deduction from production cost of main product
Sales
Main product 180,000
Less: Cost of goods sold
Materials 30,000
Labor 17,400
Overhead 17,400
Total mfg. cost/cofg manufactured 64,800
Less: Rev. from by-product 1,000
Net manufacturing cost 63,800
Less: Inventory, end 6,380
Cost of goods sold 57,420
Gross profit 122,580
Less: Selling and administrative expenses 54,000
Net income 68,580
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2. Main Product By-product A Byproduct B
Sales 75,000 6,000 3,500
Less: Cost of goods sold
Share in joint cost 32,750 3,250 1,680
Cost after separation 11,500 44,250 1,100 4,350 900 2,580
Gross profit 30,750 1,650 920
Less: Marketing & Adm. Exp. 6,000 750 500
Net Income 24,750 900 420
Hypothetical MV
2. Product Units Per Unit Total HMV Percentage Share in JC
X 8,000 20-5 120,000 40% 80,000
Y 10,000 25-7 180,000 60% 120,000
300,000 200,000
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Problem 8