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MAprocess costing

Oottaviano15y ago
Health ltd manufactures 3 joint product, WX and y in a common process.The cost and production data for March is as follows.
opening stock 40000
direct material 80000
conversion cost 100000
closing cost 20000

output and sales were as follows.

production units sales units sales price per unit

w 20000 15000 4
x 20000 15000 6
z 40000 50000 3
If cost are apportioned between joint product on market value basis, what the cost per unit of product x in march
Wwhatevaman51115y ago#1
I'm assuming the opening stock won't count here.

Total prod cost = 200,000 (Dm+CC+ClosingC)

Total sales
W: 20,000 x 4 = 80,000
X: 20,000 x 6 = 120,000
Z: 40,000 x 3 = 120,000
Total = 320,000

Cost per unit
W: 80,000/320,000 x 200,000 = 50,000
50,000/20,000 = 2.5 per unit

X: 120,000/320,000 x 200,000 = 75,000
75,000/20,000 = 3.75 per unit

Z: 120,000/320,000 x 200,000 = 75,000
75,000/40,000 = 1.88 per unit.

The sales units are not considered.
Please correct me if I'm wrong.
Thanks
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