1. Lecture 28

2. Lecture Overview Splitoff Point Joint Products and By-products Why Allocate Joint Products? Approaches to Allocating Joint Costs Sales Value at Splitoff Method

3. The Skantz Company manufactures three different products from a single raw material. A summary of production costs shows: No. of Units Market Value A20000$0.25 B150003.00 C10000 3.50 D150005.00 60000 Required: a)Distribute the total cost of $ 120000 each type of product using market value method. b)Calculate gross profit for each product, allocating the joint cost by the market value method. (there is no ending inventory left)

5. The Skantz Company manufactures three different products from a single raw material. A summary of production costs shows: No. of UnitsMarket Value Total Market Value % of Product to Market value Apportion ment of joint cost A20000$0.25 B150003.00 C10000 3.50 D150005.00 60000 Required: a)Calculate the total product cost of each type of product. b)Calculate gross profit for each product, allocating the joint cost by the market value method.

8. The Skantz Company manufactures three different products from a single raw material. A summary of production costs shows: No. of UnitsMarket Value Total Market Value % of Product to Market value Apportion ment of joint cost A20000$0.25$5000 3.125%$3750 B150003.0045000 28.12533750 C10000 3.5035000 21.87526250 D150005.0075000 46.87556250 60000$160000 100%$120000 Required: a)Calculate the total product cost of each type of product. b)Calculate gross profit for each product, allocating the joint cost by the market value method.

9. Products ABCD Units Produced 20000150001000015000 Sales1800012000800014000 Cost of Goods Sold Gross Margin Suppose if all of the products are not sold than how to calculate sales price and cost of goods sold

12. Products ABCD Sales$5000$45000$35000$75000 Cost of Goods Sold37503375026250 56250 Gross Margin 125011250875018750 Suppose if all of the products are not sold than how to calculate sales price and cost of goods sold

13. Products ABCD Units Produced 20000150001000015000 Sales units1800012000800014000 Sales Price$0.25$3.00$3.50 $5.00 Suppose if all of the products are not sold than how to calculate sales price and cost of goods sold

16. Products ABCD Units Produced 20000150001000015000 Sales1800012000800014000 Sales Price$0.25$3.00$3.50 $5.00 Total Sales 4500360002800070000 Cost of Goods Sold 3375270002100052500 Gross Margin 11259000700017500 Suppose if all of the products are not sold than how to calculate sales price and cost of goods sold 3750/20000=0.1875*18000=3375

17. The Buildon Company produces three join products: A, B, C. total joint production cost for November was $21600. The units produced and unit sales prices at the split off point were: ProductsUnitsUnits sales price A6000$2.20 B80001.25 C100001.28 Required: allocation of the production cost, using: The market value method.

18. End of Lecture 28

19. The Skantz Company manufactures three different products from a single raw material. A summary of production costs shows: No. of UnitsMarket Value Total Market Value % of Product to Market value Apportion ment of joint cost A20000$0.25$5000 3.125%$3750 B150003.0045000 28.12533750 C10000 3.5035000 21.87526250 D150005.0075000 46.87556250 60000$160000 100%$120000 Required: a)Calculate the total product cost of each type of product. b)Calculate gross profit for each product, allocating the joint cost by the market value method.

20. Products ABCD Sales$5000$45000$35000$75000 Cost of Goods Sold37503375026250 56250 Gross Margin 125011250875018750 Products ABCD Units Produced 20000150001000015000 Sales1800012000800014000 Sales Price$0.25$3.00$3.50 $5.00 Total Sales 4500360002800070000 Cost of Goods Sold 3375270002100052500 Gross Margin 11259000700017500 Suppose if all of the products are not sold than how to calculate sales price and cost of goods sold 3750/20000=0.1875*18000=3375