Paul manufactures A, B, and C, all of which are joint products, and D, which is classified
Question:
Paul manufactures A, B, and C, all of which are joint products, and D, which is classified as a by-product. If joint manufacturing costs amount to P450,000 and the company is using a popular accounting method, the firm will:
Group of answer choices
A. decrease P450,000 by the net realizable value of D and then allocate the total among A, B, C, and D.
B. allocate P450,000 among A, B, and C.
C. decrease P450,000 by the net realizable value of D and then allocate the total among A, B, and C.
D. increase P450,000 by the net realizable value of D and then allocate the total among A, B, and C.
If the net realizable value of the by-product resulting from joint production is material or significant, how shall the entity account the net realizable value of the by-product?
Group of answer choices
A. It shall be deducted from the costs of goods sold of main products.
B. It shall be added to the sales revenue of main products.
C. It shall be presented as other income.
D. It shall be deducted from the total manufacturing cost of main products.
Advanced Accounting
ISBN: 978-0538480284
11th edition
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng