× Didn't find what you were looking for? Ask a question
Top Posters
Since Sunday
5
a
5
k
5
c
5
B
5
l
5
C
4
s
4
a
4
t
4
i
4
r
4
New Topic  
dxpayne dxpayne
wrote...
Posts: 930
Rep: 1 0
6 years ago
AllCanada Wire Products processes copper into wire. It makes 12 gauge and 14 gauge wire. During April the joint costs of processing the aluminium were $365,000. There were no beginning or ending inventories for the month. Production and sales value information for the month were as follows:

Product   Feet   Separable Costs   Selling Price
14 gauge   200,000   $0.20 per metre    $0.90 per metre
16 gauge   600,000   0.30 per metre   1.00 per metre

Required:
Determine the amount of joint costs allocated to each product if the constant gross margin percentage of NRV method is used.
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
Authors:
Read 136 times
1 Reply

Related Topics

Replies
wrote...
6 years ago
Expected sales:
14 gauge 200,000 × $0.90   $180,000
16 gauge 600,000 × $1.00   600,000
Total sales       780,000
Costs:
Joint   $365,000
14 gauge (200,000 × $0.20)    40,000
16 gauge (600,000 × $0.30)    180,000    585,000
Gross margin      $195,000

gross margin percentage $195,000/$780,000 = 0.25

   14 gauge   16 gauge     Totals
Sales   $180,000   $600,000   $780,000
Less gross margin (0.25)     45,000   150,000    195,000
Cost of goods sold   $135,000   $450,000   $585,000
Separable costs     40,000    180,000    220,000
Joint costs allocated   $95,000   $270,000   $365,000
New Topic      
Explore
Post your homework questions and get free online help from our incredible volunteers
  1281 People Browsing
Related Images
  
 526
  
 67
  
 301
Your Opinion
Which is the best fuel for late night cramming?
Votes: 145