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March 4, 2021 at 3:19 pm
All the while I’ve been thinking that joint costs are apportioned based on production units. It’s surprising that this time it was based on sales units. I was wondering why are the joint costs apportioned based on sales units?
John Moffat says
March 4, 2021 at 3:55 pm
But I explain the reason in my free lectures!!! Did you not watch the lectures before attempting these questions?
Suppose we produced 10,000 units of each of 2 products, X and Y. Suppose all 10,000 of X were sold this year, but none of the 10,000 of Y were sold this year but instead remain in inventory and are sold next year.
It would be ridiculous then for all of the costs to be charged just to X. That would mean that the 10,000 of Y ended up with a cost of zero, which would be nonsense 🙂
March 4, 2021 at 7:33 pm
I’ve watched the lecture before referring the book because of which I was able to understand the concept and thereby solve many questions but maybe I’m missing something.
I was saying the same thing that costs must be apportioned to the units produced and maybe not the sales.
For question 4, shouldn’t it be like
$350K*(15000/33000) = $159,090.90
And then $159,090.90/15000 = $10.61 per unit for product P
March 5, 2021 at 8:06 am
No. Question 4 says to apportion on a market value basis, not on a units basis, and so we use the sales value of what was produced (as per the answer that appears when you ‘review quiz’ after submitting it).
March 5, 2021 at 4:58 pm
I’m really sorry. I meant Q3 which was on a physical unit basis.
October 4, 2020 at 7:28 am
I got 100%.Thank you very much opentuition.
March 7, 2020 at 11:11 pm
I can’t thank you enough for these beautiful lectures. You are a wonderful teacher!
March 8, 2020 at 6:10 am
Thank you for your comment 🙂
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