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Hello
I will like you to help me out with the answer for this question on Joint and By-product please I am having some complications. Thank you.
PR Ltd manufactures two joint products,P&R in a common process. Data for June are as follows.
Opening Inventory $1000
Direct Materials $ 10,000
Conversion Cost $12,000
Closing Inventory $3,000P
Production Units – 4000Sales Units – 5000
Sales Price $ per unit – $5
R
Production units – 6000Sales units – 5000
Sales price $ per unit – $10
If cost are apportioned between joint products on a sales value basis, what was the cost per unit of product R in June?
The cost incurred in the joint prices is 1,000+10,000+12,000-3,000 = 20,000
This is spilt between the 2 products on the basis of the sales value of the production.
For P this is 4000 x $5 = 20,000; and for R it is 6,000 x $10 = 60,000So 60,000/80,000 of the joint cost is given to R (and for the cost per unit, you obviously divide by 60,000)
The free lecture on joint costs may help you.
When I watch the lectures I always check afterwards comments because people ask questions in regards to some tasks/tests they come across.
On one hand it is a shame they have to ask that again on tutor forum after all because it is extremely difficult to find that question later on… Luckily I found it.
Thank you for solution for that task 🙂 I really enjoy the way you explain things.
PS when you said: So 60,000/80,000 of the joint cost is given to R (and for the cost per unit, you obviously divide by 60,000)
YOU meant divide by 6000? The amount of produced units???If questions are asked about the specific example in the lecture, then I try and answer them there.
However, many many people ask about other questions, and asking about other questions as a comment on a lecture is confusing for everyone (and must be asked in this forum).
Also, it is simply not possible for me to check every single lecture every day to see if there are any questions – I spend enough of my day answering the Ask the Tutor questions, and I do have work to do 🙂(It is not exactly hard to find this forum because there is a tab at the top of all the pages that is labelled “Ask ACCA Tutor” 🙂 )
Yes I did mean that – I accidentally put too many 0’s 🙂
I do imagine how many questions you have to reply to, so thank you for answering my question as well 🙂
I know how to ask you a question on “ask ACCA tutor” it is just difficult to find that person who asked you a ques. underneath the lecture if she/he did the same on the “ask the tutor” part and got the answer from you 🙂 if I cannot find it in the future I hope you do not mind me asking about the same task in separate question 🙂
Regards,
Izabela
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