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The following
production data were provided by Mix Inc. for the current period:
Product Name Units Produced Selling Price per unit at Split off point
Ace 10,000 P40
Bat 15,000 P20
Can 25,000 P12
What is the gross profit/(loss) if all the Bat items are sold in current year? (150,000 loss)
What is the joint cost allocated to Can Items using the relative sales value method? (450,000)
Problem 2: Combi Inc. manufactures three joint products. The following production data were
provided by Combi Inc. for the current period:
Product Name Units produced Additional Processing costs after Final Selling Price
split off point
Xen 1,000 P20,000 P50
Yen 2,000 10,000 10
Zen 3,000 30,000 30
The company uses the net realizable value method for allocating joint costs.
What is the Gross Profit/(loss) on the sale of all Xen products? (15,000)
What is the total Gross Profit/(loss) on the sale of all joint products?(50,000)
Problem 3: Blend Inc. manufactures three joint products and allocates joint costs at its relative
sales value at split off point. The following joint product costs were incurred for the current
period:
The following production data were provided by Blend Inc. for the current period:
What is the total gross profit/(loss) for the current period if Blend Inc. will correctly process
further the proper items? (540,000)
Problem 4: CONSO Inc. manufactures joint products ALT and TAB, and a by-product DEL.
Costs are assigned to the joint products by the net realizable value or final market value method
which considers further processing costs in subsequent operations. It is the policy of CONSO Inc
to account for its by- product by market value or reversal cost method or deduction of net
realizable of by product from the joint manufacturing costs of main products. The total
manufacturing costs for 100,000 units were P1,520,000 during the year. Production and costs
data follow:
ALT TAB DEL
Units produced 60,000 30,000 10,000
Sales price per unit P70 P25 P10
Further processing cost per unit 20 5 3
Selling and admin expense per unit 5
What is the value of DEL to be deducted from the joint manufacturing costs? (P20,000)
What is the gross profit of ALT foe the year? (P1,750,000)
What is the gross profit of TAB for the year? (P350,000)
Problem 5: Merge Inc. manufactures ZEN product from a process that yields a by product called
YAN. The by- product requires additional processing cost of P30,000. The by- product will
require selling and administrative expenses totaling P20,000. It is Merge’s accounting policy to
charge the joint costs to the main product only. Information concerning a batch produced during
the year ended December 31, 2020 follows:
The selling and administrative expenses of Merge Inc. for the year ended December 31, 2020 is
P1,000,000 exclusive of that for the by-product.
What is the gross profit for the year if the net revenue from by- product is presented as other
income? (1,200,000)
What is the gross profit for the year if the net revenue from by-product is presented as additional
sales revenue? (1,230,000)
What is the net income for the year if the net revenue from by- product is presented as deduction
from cost of goods sold? (230,000)
What is the net income for the year if the net revenue from the by-product is presented as
deduction from the total manufacturing cost of the main product? (218,000)