Required:

REQUIREMENT 1:
SALES VALUE METHOD
PRODUCT A PRODUCT B PRODUCT C PRODUCT D
1. Sales value at split-off point:
Poduct A: 1,000 x 10 10,000.00
Product B: 2,000 x 20 40,000.00
Product C: 3,000 x 20 60,000.00
Product D: 4,000 x 10 40,000.00
2. Ratio:
Product A: 10/150 0.07
Product B: 40/150 0.27
Product C: 60/150 0.40
Product D: 40/150 0.27
3. Allocated joint costs:
Product A: 100,000 x 0.07 6,666.67
Product B: 100,000 x 0.27 26,666.67
Product C: 100,000 x 0.40 40,000.00
Product D: 100,000 x 0.27 26,666.67
4. Joint costs per product:
Product A: 6,666.67/1,000 6.67
Product B: 26,666.67/2,000 13.33
Product C: 40,000/3,000 13.33
Product D: 26,666.67/4,000 6.67

REQUIREMENT 2:
Product C:
Ending inventory: Units on hand x weight per unit x joint cost per unit
Sales Value Method: 500 units x 2 lbs. x 13.33 = 13,333.33
Weighted Average Method: 500 units x 2lbs x 5 = 5,000.00
REQUIREMENT 1:
WEIGHTED AVERAGE METHOD
PRODUCT A PRODUCT B PRODUCT C PRODUCT D
1. Physical Measures
Product A: 1,000 x 4 4000
Product B: 2,000 x 3 6000
Product C: 3,000 x 2 6000
Product D: 4,000 x 1 4000
2. Ratio
Product A: 4,000/20,000 0.20
Product B: 6,000/20,000 0.30
Product C: 6,000/20,000 0.30
Product D: 4,000/20,000 0.20
3. Allocated joint costs:
Product A: 100,000 x .20 20,000.00
Product B: 100,000 x 0.30 30,000.00
Product C: 100,000 x 0.30 30,000.00
Product D: 100,000 x 0.20 20,000.00
4. Joint costs per product:
Product A: 20,000/4,000 5.00
Product B: 30,000/6,000 5.00
Product C: 30,000/6,000 5.00
Product D: 20,000/4,000 5.00

REQUIREMENT 2:
 REQUIREMENT 1
Nissins Ramens
1. Sales value before cost allocation:
Nissins: 60,000 x 36 2,160,000.00
Ramens: 120,000 x 50 6,000,000.00
2. Less separable costs (240,000.00) (840,000.00)
3. Adjusted sales value at split off point 1,920,000.00 5,160,000.00
4. Ratio:
Nissins: 1,920,000/7,080,000 0.27
Ramens: 5,160,000/7,080,000 0.73
5. Allocated joint costs:
Nissins: 1,200,000 x 0.27 325,423.73
Ramens: 1,200,000 x 0.73 874,576.27
6. Production cost per ton
Allocated joint cost 325,423.73 874,576.27
Seperable costs 240,000.00 840,000.00
Total production costs 565,423.73 1,714,576.27
Divide by tons produced 60,000.00 120,000.00
Production costs per ton 9.42 14.29
 REQUIREMENT 2
a.) main products are sold at split off point
LUCKY COMPANY
INCOME STATEMENT
FOR MONTH XX

Revenues:
Lucky Him: 50,000 x 20
Lucky Her: 100,000 x 30
Cost of goods sold (joint costs)
Gross profit

b.) main products are processed further to become Nissins and Ramens
LUCKY COMPANY
INCOME STATEMENT
FOR MONTH XX
Revenues:
Nissins: 60,000 x 36
Ramens: 120,000 x 50
Cost of goods sold:
Joint costs
Separable cost
Cost of goods sold (joint costs)
Goss profit
Lucky Him Lucky Her

1,000,000.00
3,000,000.00
300,000.00 900,000.00
700,000.00 2,100,000.00

Nissins Ramens
2,160,000.00
6,000,000.00

325,423.73 874,576.27
240,000.00 840,000.00
565,423.73 1,714,576.27
1,594,576.27 4,285,423.73
MCQ - Theoretical MCQ - Computational
1. a 1. a 13. a 25. a 37. a 49. a
2. d 2. a 14. a 26. a 38. b 50. a
3. d 3. a 15. b 27. d 39. a 51. a
4. b 4. b 16. d 28. b 40. b 52. a
5. c 5. a 17. d 29. c 41. a 53. d
6. c 6. a 18. a 30. c 42. a 54. b
7. d 7. a 19. a 31. c 43. b 55. b
8. d 8. c 20. d 32. d 44. b 56. a
9. c 9. c 21. a 33. a 45. d 57. b
10. a 10. b 22. a 34. c 46. b 58. b
11. a 11. b 23. c 35. d 47. b 59. a
12. b 12. d 24. a 36. d 48. a 60. c
61. a