Company manufactures one main product and two by products Data for May are:

Main BP-X BP-Y

Sales 120,000 15,000 8,000

Cost after 20,000 2,500 1,500

separation

Selling cost 13,000 1,200 1,100

Total joint costs before separation is 80,000. Profit allowed for by product X is 15% of sales and for by product Y in 20% os sales.

What is the net income for the two products?

Company uses the net realizable method to account for its by product. The information below relates to Company's main product and by product for the current period:

Units Main product By-Product

Produced 20,000 4,000

Sold 16,000 2,500

Ending inventory 4,000 500

Actual sales revenue of the main product 16,000 units a 3 per unit equals 48,000 and the by product @1

.50 per unit. Total production costs equal 40,000. Additional by product processing costs not included in total production estimates are 300. The estimated marketing and administrative expenses for the main product and for the by product are 4,200 and 800, respectively. What is the company's net income?

Answer rating: 100% (QA)

To calculate the net income for the two products in the first scenario we need to consider the sales ... View the full answer