Question : Use the information below to answer the following question(s). Chem Manufacturing : 1186045

 

Use the information below to answer the following question(s).

 

Chem Manufacturing Company processes direct materials up to the split off point, where two products (X and Y) are obtained and sold. The following information was collected for the month of November.

 

Direct materials processed:

10,000 litres (10,000 litres yield 9,500 litres of good product and 500 litres of shrinkage)

 

Production:

X 5,000 litres

Y 4,500 litres

Sales:

X 4,750 at $150 per litre

Y 4,000 at $100 per litre

 

The cost of purchasing 10,000 litres of direct materials and processing it up to the split off point to yield a total of 9,500 litres of good products was $975,000.

The beginning inventories totalled 50 litres for X and 25 litres for Y. Ending inventory amounts reflected 300 litres of product X and 525 litres of product Y. October costs were per unit were the same as November.

 

21) What are the respective physical volume proportions for products X and Y?

A) 55.00% and 45.00%

B) 54.00% and 46.00%

C) 52.63% and 47.37%

D) 47.37% and 53.63%

E) 36.36 % and 63.64%

 

22) What is the approximate portion of the joint costs that should be allocated to products X and Y, respectively, using a physical volume measure?

A) $461,858 and $513,142

B) $487,500 and $487,500

C) $513,142 and $461,858

D) $529,285 and $445,715

E) $530,000 and $470,000

23) What is Product X’s approximate production cost per unit using the physical volume method?

A) $0.10

B) $10.23

C) $53.15

D) $55.00

E) $102.63

 

24) What method is used when joint costs are allocated according to each item’s relative proportion of weight at the split off point?

A) direct proportion method

B) proportional value method

C) physical measure method

D) weighted sales value method

E) constant margin method

 

25) An advantage of the sales value at split off method is

A) the fact that it can be supported subjectively.

B) the fact that only a few assumptions are required beyond the split off point.

C) the fact that there may not be a ready market at the split off point.

D) it always yields the same results as the gross margin percentage method.

E) the cost allocation base is well understood.

Use the information below to answer the following question(s).

 

Chem Manufacturing Company processes direct materials up to the split off point, where two products (X and Y) are obtained and sold. The following information was collected for the month of November.

 

Direct materials processed:

10,000 litres (10,000 litres yield 9,500 litres of good product and 500 litres of shrinkage)

 

Production:

X 5,000 litres

Y 4,500 litres

Sales:

X 4,750 at $150 per litre

Y 4,000 at $100 per litre

 

The cost of purchasing 10,000 litres of direct materials and processing it up to the split off point to yield a total of 9,500 litres of good products was $975,000.

The beginning inventories totalled 50 litres for X and 25 litres for Y. Ending inventory amounts reflected 300 litres of product X and 525 litres of product Y. October costs were per unit were the same as November.

 

26) What is product Y’s approximate joint production cost if the sales value at split off point method is used?

A) $365,625

B) $419,250

C) $458,250

D) $600,000

E) $609,375

 

27) If joint products end up with the same gross margin percentage, which of the following is true?

A) The cost allocation method assigned the same cost per unit to each product.

B) The physical measure method must have been used.

C) The gross margin percentage NRV method must have been used.

D) The estimated net-realizable method must have been used.

E) If all products are sold at the split off point, and there were no opening inventories, the sales value at split off method could have been used.

28) Which of the following is FALSE concerning the physical measure method?

A) Technical personnel outside of accounting may be required in the joint costing determinations.

B) Using the benefits-received criterion, the physical measure method less preferred than the sales at split off method.

C) The physical measure may not reflect each individual product’s ability to generate revenues.

D) Using a common physical measure can result in the product with the lowest revenue-producing power having the most costs assigned to it.

E) It results in a constant gross margin for all products.

 

Use the information below to answer the following question(s).

 

Chem Manufacturing Company processes direct materials up to the split off point, where two products (X and Y) are obtained and sold. The following information was collected for the month of November.

 

Direct materials processed:

10,000 litres (10,000 litres yield 9,500 litres of good product and 500 litres of shrinkage)

 

Production:

X 5,000 litres

Y 4,500 litres

Sales:

X 4,750 at $150 per litre

Y 4,000 at $100 per litre

 

The cost of purchasing 10,000 litres of direct materials and processing it up to the split off point to yield a total of 9,500 litres of good products was $975,000.

The beginning inventories totalled 50 litres for X and 25 litres for Y. Ending inventory amounts reflected 300 litres of product X and 525 litres of product Y. October costs were per unit were the same as November.

 

29) What is product X’s approximate gross margin percentage using the physical volume method?

A) 30%

B) 32%

C) 33%

D) 35%

E) 38%

Use the information below to answer the following question(s).

 

Beverage Drink Company processes direct materials up to the split off point, where two products, A and B, are obtained. The following information was collected for the month of July:

 

Direct materials processed: 2,500 litres (with 20 percent shrinkage)

 

Production:

A

1,500 litres

 

B

500 litres

 

 

 

Sales:

A

$15.00 per litre

 

B

$10.00 per litre

 

Cost of purchasing 2,500 litres of direct materials and processing it up to the split off point to yield a total of 2,000 litres of good products was $4,500. There were no inventory balances of A and B.

 

Product A may be processed further to yield 1,375 litres of Product Z5 for an additional processing cost of $150. Product Z5 is sold for $25.00 per litre. There was no beginning inventory and ending inventory was 125 litres.

 

Product B may be processed further to yield 375 litres of Product W3 for an additional processing cost of $275. Product W3 is sold for $30.00 per litre. There was no beginning inventory and ending inventory was 25 litres.

 

30) What is Product B’s estimated sales value at the split off point?

A) $3,500

B) $3,750

C) $4,500

D) $5,000

E) $8,250