CA Inter P4 · Chapter 10 · Question 2 of 8
Using the same output (P 6,000 kg, Q 10,000 kg) and joint cost of ₹4,80,000, P can be sold at the split-off point for ₹50 per kg and Q for ₹45 per kg. Under the sales value at split-off method, the joint cost apportioned to P is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) ₹1,92,000.00
Explanation
Sales value at split-off: P = 6,000 x ₹50 = ₹3,00,000; Q = 10,000 x ₹45 = ₹4,50,000; total ₹7,50,000. Share of P = ₹4,80,000 x 3,00,000/7,50,000 = ₹1,92,000. Using price per kg alone ignores quantities and is incorrect.
More Joint Products and By-Products MCQs
- Q4A by-product is sold for ₹1,20,000. Selling expenses are 10% of sales, the expected profit margin is 20% of sales and post-separation…
- Q5The main distinction between joint products and by-products is based on:
- Q6The split-off point is the point in a joint production process at which:
- Q7A joint product can be sold at split-off for ₹40 per kg, or processed further and sold at ₹56 per kg. Further processing of the 5,000 kg…
- Q8Under the survey (point value) method of apportioning joint costs, the basis of apportionment is: