The Trece Co. manufactures joint products X and Y as well as by-product Z. Cumulative costs data for the period show P204,000 representing 20,000 units completed processed through the Refining Department at an average cost of P10.20. Costs are assigned to X and Y by the market value method which considers further processing costs in subsequent operations. Additional data:                                     Z             X             Y Quantity processed                2,000 units   8,000 units   10,000 units Sales price per unit                        P5             P20               P25 Further processing cost per unit     1               5                   7 Marketing and administrative expense per unit                              1 Operating profit per unit                1  Required: a. Assuming by-product value is material determine the joint cost allocated to Z using Net realizable value method and joint cost to X and Y. b. Assuming by-product value is immaterial and insignificant, what is the joint cost allocated to X and Y.

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The Trece Co. manufactures joint products X and Y as well as by-product Z. Cumulative costs data for the period show P204,000 representing 20,000 units completed processed through the Refining Department at an average cost of P10.20. Costs are assigned to X and Y by the market value method which considers further processing costs in subsequent operations.
Additional data:                                     Z             X             Y
Quantity processed                2,000 units   8,000 units   10,000 units
Sales price per unit                        P5             P20               P25
Further processing cost per unit     1               5                   7
Marketing and administrative
expense per unit                              1
Operating profit per unit                1 

Required:
a. Assuming by-product value is material determine the joint cost allocated to Z using Net realizable value method and joint cost to X and Y.
b. Assuming by-product value is immaterial and insignificant, what is the joint cost allocated to X and Y.

Question
The Trece Co. manufactures joint products X and Y as well as by-product Z. Cumulative costs data for
the period show P204,000 representing 20,000 units completed processed through the Refining
Department at an average cost of P10.20. Costs are assigned to X and Y by the market value method
which considers further processing costs in subsequent operations.
Additional data:
10,000 units
Quantity processed
Sales price per unit
Further processing cost per unit
Marketing and administrative expense per unit
Operating profit per unit
2,000 units
8,000 units
P5
P20
P25
1
7
1
1
Required:
a. Assuming by-product value is material determine the joint cost allocated to Z using Net realizable
value method and joint cost to X and Y.
b. Assuming by-product vaļue is immaterial and insignificant, what is the joint cost allocated to X and Y.
Transcribed Image Text:Question The Trece Co. manufactures joint products X and Y as well as by-product Z. Cumulative costs data for the period show P204,000 representing 20,000 units completed processed through the Refining Department at an average cost of P10.20. Costs are assigned to X and Y by the market value method which considers further processing costs in subsequent operations. Additional data: 10,000 units Quantity processed Sales price per unit Further processing cost per unit Marketing and administrative expense per unit Operating profit per unit 2,000 units 8,000 units P5 P20 P25 1 7 1 1 Required: a. Assuming by-product value is material determine the joint cost allocated to Z using Net realizable value method and joint cost to X and Y. b. Assuming by-product vaļue is immaterial and insignificant, what is the joint cost allocated to X and Y.
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ISBN:
9781947172609
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OpenStax
Publisher:
OpenStax College