Costing - Study Mode

[#956] If final sales are $50000 and separable costs are $35000, then net realizable value will be
Correct Answer

(A) $15,000

Explanation

Solution: If final sales are $50000 and separable costs are $35000, then net realizable value will be $15,000. Net realizable value = Final Sales - Seperable Cost. = $50000 - $35000 = $15000.

[#957] Joint cost allocation method, in which individual product from joint products must gain a gross margin percentage is classified as
Correct Answer

(C) constant gross margin percentage NRV method

Explanation

Solution: Joint cost allocation method, in which individual product from joint products must gain a gross margin percentage is classified as constant gross margin percentage NRV method. Joint cost is the manufacturing cost incurred on a joint production process which takes common inputs but simultaneously produces multiple products called joint-products.

[#958] Manufacturing, distribution and marketing costs incur after split off point is classified under
Correct Answer

(A) separable costs

Explanation

Solution: Manufacturing, distribution and marketing costs incur after split off point is classified under separable costs. Separable costs are any costs incurred after the split-off point in a production process that can be assigned to specific products.

[#959] Method which allocates joint costs of joint products, considering physical measures such as volume or relative weight at point of split off is known as
Correct Answer

(C) physical-measure method

Explanation

Solution: Method which allocates joint costs of joint products, considering physical measures such as volume or relative weight at point of split off is known as physical-measure method. The physical measure method allocates cost by the weight, volume, or some other measurement of the product that's produced.

[#960] If value of final sales is $48000 and net realizable value is $35000, then value of sales costs would be
Correct Answer

(B) $13,000

Explanation

Solution: If value of final sales is $48000 and net realizable value is $35000, then value of sales costs would be $13,000. Sales Cost = Final Sales - Net Realizable Value. = $48000 - $35000 = $13000.