Pran Food Industries works on a batch processing basis. Each batch begins with ten tons of...

 

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Pran Food Industries works on a batch processing basis. Each batch begins with ten tons of a vegetable product. The firm purchases the product for Tk.65000. The input is separated into three products at a cost of Tk15000. The typical batch yields 5000 pounds Page ! of 4 of product A. product A is treated at a cost of Tk.1 per pound, after which it is ready for sale for Tk.12 per pound. The batch of input also yields 2000 pounds of product B. Product B must be sterilized at a cost of Tk.2 per pound and then it is sold for Tk.S per pound. The remaining 13000 pounds of output are sent through a second separator at a cost of Tk.15000. From this process the firm obtains 6000 pounds of product C, which sells for Tk.10 per pound and 7000 pounds of product D, which sells for Tk.8 per pound. The firm started the current period with no inventories. They processed one batch of input (all units were completed). Their sales in pounds were as follows: Product A 4500 Product B 1800 Product C 4000 Product D 6200 Product B is considered a by-product. Required: Determine the net income for the period and the cost of ending inventory, if the firm credits the net realizable value of the by-product against the joint processing cost at the ime the by product is produced. Pran Food Industries works on a batch processing basis. Each batch begins with ten tons of a vegetable product. The firm purchases the product for Tk.65000. The input is separated into three products at a cost of Tk15000. The typical batch yields 5000 pounds Page ! of 4 of product A. product A is treated at a cost of Tk.1 per pound, after which it is ready for sale for Tk.12 per pound. The batch of input also yields 2000 pounds of product B. Product B must be sterilized at a cost of Tk.2 per pound and then it is sold for Tk.S per pound. The remaining 13000 pounds of output are sent through a second separator at a cost of Tk.15000. From this process the firm obtains 6000 pounds of product C, which sells for Tk.10 per pound and 7000 pounds of product D, which sells for Tk.8 per pound. The firm started the current period with no inventories. They processed one batch of input (all units were completed). Their sales in pounds were as follows: Product A 4500 Product B 1800 Product C 4000 Product D 6200 Product B is considered a by-product. Required: Determine the net income for the period and the cost of ending inventory, if the firm credits the net realizable value of the by-product against the joint processing cost at the ime the by product is produced.