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Question 1 - DNA Ltd. produces two main products, A and B; and, a byproduct, C. There were no beginning inventories. During April, it incurred $275,000 of joint costs, which are allocated to main products using the physical output method. Additional information follows:
Product
Unit Produced
Units Sold
Unit Sales Price
A
12,000
9,600
$22
B
18,000
15,300
38
C
6,000
5,200
3
Required - Assuming DNA recognizes byproduct revenue at the time of sale, what is the total value of ending inventory?
Question 2 - Chemical X, Inc. processes pine rosin into three products; turpentine, paint thinner, and spot remover. During June the joint costs of processing were $280,000. Production and sales value information for the month were as follows:
Units Produced
Sales Value at Split off Point
Turpentine
3,000 litres
$30,000
Paint Thinner
25,000
Spot remove
1,500 litres
12,500
Required - Determine the amount of joint cost allocated to each product if the physical measure method is used.
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