CONSO Inc. manufactures joint products ALT and TAB, and a by-product DEL. Costs are assigned to the
Question:
CONSO Inc. manufactures joint products ALT and TAB, and a by-product
DEL. Costs are assigned to the joint products by the net realizable value or final market value method which considers further processing costs in subsequent operations. It is the policy of CONSO Inc. to account for its by-product by market value or reversal cost method or deduction of net realizable value of by-product from the joint manufacturing costs of main products. The total manufacturing costs for100,000 units were P1,520,000 during the year. Production and costs data follow:
ALTTABDEL
Units produced 60,00030,00010,000
Sales price per unit P70P25 P10
Further processing
cost per unit 2053
Selling and admin expense per unit 5
1.What is the value of DEL to be deducted from the joint manufacturing costs?
2.What is the gross profit of ALT for the year?
3.What is the gross profit of TAB for the year?
Expert Answer:
To answer the questions we need to calculate the values of DEL to be deducted from the joint manufacturing costs as well as the gross profits of ALT a... View the full answer
