Silverman Company produces 20,000 units of A, 20,000 units of B, and 10,000 units of product C
Question:
Silverman Company produces 20,000 units of A, 20,000 units of B, and 10,000 units of product C from the same manufacturing process at a cost of $340,000. A and B are joint products, and C is regarded as a by-product. The unit selling prices of the products are $50 for A, $25 for B, and $1 for C. None of the products require additional processing. Of the units produced, Silverman Company sells 18,000 units of A, 19,000 units of B, and 10,000 units of C. The firm uses the net realizable value method to allocate joint costs and by-product costs. Assume no beginning inventory.
| Output Volume: | |||
| A = | 20,000 | ||
| B = | 20,000 | ||
| C = | 10,000 | ||
| Joint Costs = | $340,000 | ||
| Unit sellling prices: | |||
| A = | $50 | ||
| B = | $25 | ||
| C = | $1 | ||
| Unit sales volume: | |||
| A = | 18,000 | ||
| B = | 19,000 | ||
| C = | 10,000 | ||
| Separable Processing Costs: | |||
| A = | $0 | ||
| B = | $0 | ||
| C = | $0 | ||
Required
1. What is the value of the ending inventory of product A?
2. What is the value of the ending inventory of product B?
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Product A Product B Product C Total Units Produced 20000 20000 10000 Units Sold 18000 19000 10000 ...View the full answer
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
