Use the following information for the next 4 questions.
A joint process has total costs of $1,200 and yields 50 units each of two main products and 10 units of by-product that can be sold for $2.50 each.
-Under the realized value approach to accounting for by-products, what is the per unit cost of a main product if the physical output method of allocating joint costs is used?
A) $12.00
B) $24.00
C) $11.75
D) $23.50

Question

Quizplus · Accepted Answer

The realized value of the by-product is $25 (10 units x $2.50). This amount is deducted from the total joint costs, leaving $1,175 to be allocated to the main products. Using the physical output method, the joint cost per unit for the main products is $11.75 ($1,175 / 100 units).

Use the Following Information for the Next 4 Questions