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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Joint cost apportionment
An organisation operates a process that creates two joint products (T and V). Product T has a selling price of $20 per litre and product V has a selling price of $60 per litre. Last month joint costs of $600,000 were incurred and the completed production was as follows:
product t: 18,000 litres
product v: 9,000 litres
The organisation uses the sales value method of apportioning joint costs.
they were asking for the joint costs that is apportioned to product v, the answer is $240,000 but what is the solution for the answer?
You cannot have watched my free lecture on joint costs, and I am not going to type it all out here!
You calculate the total sales value of the production, and you split the joint cost between the products on that basis.