29 Jun Question Which of the following is not a step needed
QuestionQuestion
Which of the following is not a step needed
Question
Which of the following is not a step needed to maximize the profits from joint products?
1.Forecasting the sales price of each final product
2.Identifying alternative sets and quantities of final products possible from the joint
process
3.Determining how to allocate joint costs to the final products
4.Estimating the costs required to further process joint products into salable products
Question
A product’s net realizable value is calculated by:
1.Deducting the cost of goods sold from the sales revenue
2.Deducting the allocated joint costs and processing costs after split-off from the sales revenue
3.Deducting unit-level costs from the sales revenue
4.Deducting processing costs after split-off from the sales revenue
Question
Great Sweets Candy Company produces various types of candies. Several candies could be
sold at the
split-off point or processed further and sold in a different form after further processing.
The candies are produced in a joint processing operation with $500,000 of joint processing
costs
monthly, which are allocated based on pounds produced. Information concerning this process
for a
recent month appears below:
Candy type – Sweet Meats- # of pounds 50,000, Price per pound a split off $ 8.00 Further processing Cost 75,000, price after processing $10.00
Candy type – Sweet Meats- # of pounds 100,000, Price per pound a split off $ 10.00 Further processing Cost 30,000, price after processing $10.50
Candy type – Sweet Meats- # of pounds 25,000, Price per pound a split off $ 5.00 Further processing Cost 20,000, price after processing $5.50
The joint processing costs in this operation:
1.Should be allocated to products to determine whether they are sold at split-off or
processed further
2.Should be ignored in determining whether to sell at split-off or process further
3.Should be ignored in making all product decisions
4.Are never included in product cost, as they are misleading to all management decisions
Question
Gardner Company processes products in a joint processing operation that produces products A
and B in a
joint process. The company incurs $1,200,000 of joint processing costs monthly. Currently,
3,600 of A and
2,800 of B are being produced each month. Management plans to decrease B’s production by
600 units in order
to increase the production of A by 1,000 units. Additionally, this change will require minor
modifications
which will add $40,000 to the production costs. This cost is entirely attributable to product B
What is the amount of the joint costs allocable to A before the changes are made to the existing
production process, assuming Gardner allocates its joint costs according to the proportion of
A and B produced?
1.$675,000
2.$547,058
3.$529,412
4.$525,000
[$1,200,000 x 3600/6400 = $675,000/-]
Question
Which of the following is not a method of allocating joint costs?
1.Sales value at split-off
2.Net realizable value
3.By-product method
4.Physical-measures method
Question
Which of the following would not be a physical measure used to allocate joint costs?
1.Number of pounds produced
2.Cubic feet of gas produced
3.Sales value at split off
4.Energy content (BTUs)
Question
In joint-process costing and analysis, which of the following costs is relevant when deciding the
point at which a product should be sold to maximize profits?
1.The cost of the machinery used to produce the three products
2.The salaries of production personnel making the product
3.The cost of the materials required for the joint products
4.The selling price if the products are processed further
Question
Which of the following would not be a joint-product cost?
1.Cost of picking apples to be processed into cider and applesauce in a cider factory
2.Cost of cinnamon used in applesauce
3.Cost of maintaining oil rigs for an oil manufacturer
4.Costs of running a fishing boat that sells haddock, cod, and lobsters to wholesalers
Question
Allocation of factory service department costs to the production departments is necessary to:
1.Measure use of plant capacity
2.Make sure that machines are operating efficiently
3.Calculate cost per unit for purposes of external financial reporting
4.Control costs
Question
Which of the following would be an appropriate cost-allocation base for allocating the
cost of the company cafeteria?
1.Square footage occupied by departments
2.Number of hours of use
3.Number of meals served
4.Salaries of personnel purchasing meals
Question
Which of the following would not be an appropriate cost-allocation base for the Personnel
department costs?
1.Space occupied
2.Number of employees
3.Total payroll dollars in department using the equipment
4.Labor hours
Question
Which of the following would not be an appropriate cost-allocation base for allocating the
cost of the corporate library in a consulting company with multiple divisions?
1.Number of employees employed in each division
2.Square footage occupied by each division
3.Cost of periodicals ordered by each division
4.Number of consultants employed in each division
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