Chapter 13-2 – Review Questions For the following question(s) refer to the information below. The Moody Company produces three joint products at a joint cost of $100,000. Two of these products were precessed further. Production and sales were: Weight Sales Additional Processing Costs P: 300,000 lbs $245,000 $200,000 Q: 100,000 lbs 30,000 0 R: 100,000 lbs 175,000 100,000 1 If the net realizable value method is used and product Q is accounted for as a joint product, how much of the joint costs would be allocated to product R?: A. $ 38,889 B. $ 41,667 C. $50,000 D. $62,500 E Some other answer 2 Assume Q is a by-product whose sales value is credited to the joint production costs. If net realizable value is used, how much of the joint costs would be allocated to product R? A. $ 38,889 B. $ 43,750 C. $ 50,000 D. $ 62,500 E. Some other answer 3 If the physical units method is used and product Q is accounted for as a joint product, how much of the joint costs would be allocated to product R?: A. $ 20,000 B. $ 25,000 C. $60,000 D. $75,000 E Some other answer4 Great Falls Company makes two products, G and H. They are initially processed from the same raw material and then, after split-off, further processed separately. Additional information is as follows: G H Total Final sales price $9,000 $6,000 $15,000 Joint costs prior to split-off point -- -- 6,600 Costs beyond split-off point 3,000 3,000 6,000 What are the joint costs allocated to products A and B assuming Great Falls uses the net realizable value approach? G H A. $3,300 $3,300 B. $3,960 $2,640 C. $4,400 $2,200 D. $4,560 $2,040 5 Raymer Corporation produced 3,660 units, consisting of three separate products, in a joint process for the year. The market for these products was so unstable that it was not practical to estimate the selling price of the products. A cost of $425,000 was incurred in the joint process. Product X's production was 80% of product Y's while product Z's production was 125% of product Y's. What is the amount of the joint cost allocable to product X assuming Raymer uses the physical units method of allocation? A. $111,475 B. $114,865 C. $139,344 D.
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