Comments

    • Profile photo of John Moffat says

      Well that was a useful comment!!!
      The answers are perfectly correct for the values when the products leave the joint process.
      The final stock value of A will of course be higher in each case by the $3 per kg spent on further processing.

      • avatar says

        I still dont get it.. The answer to point i) : cost per kg is counted: 446,000 : (10,000+50,000) = 7.43 $ (for A and B) , so the by-product is not substracted in units but it is in cost, why? In your lecture the answer is 8.92 $
        point ii) : the answer for A – 6.76 $ but in your lecture 7.96 $, for B – 9.46 $, in your lecture 9.91 $… there is no difference of 3 $ :-S..
        ps. btw – i totally love your lectures, thanx a lot!!! :-)

      • Profile photo of John Moffat says

        Oh dear – I am terribly sorry.
        It has been a long day and I quickly checked the answer before and didn’t spot my mistake.

        The lecture is correct. I will correct the printed answer and get admin to upload it ASAP.

        I do apologise again :-(

  1. avatar says

    I have found this very useful, the lecturer repeats all the pitfalls very clearly, always work with production units :) and read carefully what the question ask of you, that will lead you what to do with the by product (subtract it from total production cost or nothing if it goes to sales)
    Thanks

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