ACCTG 201 – COST ACCOUNTING

Allocation of Joint Costs and Accounting for By-Products

Physical Measure

Problem 1

Kawamura Company operates a chemical process which produces three different products ZEE, JEE and YEE. The
three products are saleable at split-off point. The joint cost for the period is P250,000. The production data are as
follows:

Products ZEE JEE YEE

Units of Production 500 300 200
Quality Grade of the Outputs 10 stars 8 stars 5 stars
Weight per Unit 4 ounces 3 ounces 3 ounces

Allocated the joint cost to products Zee, Jee and Yee based on the following methods.

1. Quantitative or Physical Method

2. Average unit cost (or units of production method)

3. Weighted average method

Problem 2

Kawamura Company operates a chemical process which produces three different products ZEE, JEE and YEE. The
three products are saleable at split-off point. The joint cost for the period is P250,000. The production data are as
follows:

Products ZEE JEE YEE

Units of Production 500 300 200
Quality Grade of the Outputs 10 stars 8 stars 5 stars
Weight per Unit 4 ounces 3 ounces 3 ounces

Allocated the joint cost to products Zee, Jee and Yee based on the following methods.

1. Quantitative or Physical Method

2. Average unit cost (or units of production method)

3. Weighted average method