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Joint products and by-products Multiple choice questions (MCQs) quiz
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ABOUT THIS QUIZ:
- Chapter: Joint products and by-products
- Quiz Type: Multiple choice questions (MCQs) quiz
- Number of MCQs: 25
- Total Points: 25
- Approximate Time Required: 15 – 20 minutes
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Question 1 of 25
1. Question
Two different products are obtained by refining one ore. The refining process would be considered as:
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Question 2 of 25
2. Question
The joint production cost should be allocated:
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Question 3 of 25
3. Question
The joint product costing method that produces the same gross profit percentage for all products is known as:
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Question 4 of 25
4. Question
When a company produces two different products through a common production process, the factor that determines whether the two products are joint products or one main product and one by-product is the:
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Question 5 of 25
5. Question
The basic objective of allocating the joint cost of a processing center to various products is to:
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Question 6 of 25
6. Question
A by-product:
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Question 7 of 25
7. Question
The Five Star Company manufactures two products which can be sold at split-off point or processed further and sold as superior quality items. The decision to sell the products at split-off point or process them further should be based on the:
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Question 8 of 25
8. Question
Hypothetical market value is equal to:
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Question 9 of 25
9. Question
The Ultimate market value of a product X is $20 per unit. The processing cost after split-off point is $5 per unit and marketing and administrative expenses are $1 per unit. If 10,000 units are produced during a period, the hypothetical market value of product X would be:
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Question 10 of 25
10. Question
A separable cost is the:
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Question 11 of 25
11. Question
The point at which two or more products emerge in their separately identifiable form is known as:
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Question 12 of 25
12. Question
A cost incurred to produce two or more products in a common production process is termed as:
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Question 13 of 25
13. Question
A method that uses measurement units such as tons, gallons, kilograms, pounds and feet to apportion joint cost is known as:
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Question 14 of 25
14. Question
The quantitative unit method of joint cost allocation is also known as:
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Question 15 of 25
15. Question
Another name used for market value method of joint cost allocation is:
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Question 16 of 25
16. Question
A method that considers all the joint products as the same unit is known as:
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Question 17 of 25
17. Question
A method that assigns predetermined weight factors to each unit of various joint products for the purpose of allocating joint cost is known as:
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Question 18 of 25
18. Question
The Merhaba Company produces 5,000 units of product X and 4,000 units of product Y in a joint production process. If a weight factor of 2 is assigned to each unit of product X and a weight factor of 4 is assigned to each unit of product Y, the weighted number of units would be:
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Question 19 of 25
19. Question
The replacement cost method for by-products is used by companies that:
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Question 20 of 25
20. Question
Which of the following statements about recognition of gross revenue method for by-products is correct?
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Question 21 of 25
21. Question
Companies often recover one or more secondary products while manufacturing their primary products. In cost and management accounting, these secondary products are termed as:
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Question 22 of 25
22. Question
Under generally accepted accounting principles (GAAP), which of the following joint cost allocation methods is not acceptable?
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Question 23 of 25
23. Question
Marshal Inc., manufactures two products, A and B, in a joint manufacturing process. Product A is sold for $10 and product B is sold for $5. In January, 10,000 units of product A and 15,000 units of product B were manufactured. The total joint cost in January was $75,000. The additional processing cost after split-off was $15,000 for product A and $10,000 for product B.
Based on the above data, the joint cost allocation to product A and product B under net realizable value (NRV) method would be:
Correct
Awesome! Your answer is correct.
Computations and explanations:
Net realizable values:
Product A: (10,000 units × $10) – $15,000 = $85,000
Product B: (15,000 units × $ 5) – $10,000 = $65,000Joint cost allocation ratios and joint cost allocation using NRV method:
X: ($85,000 / $150,000) × $75,000 = $42,500
Y: ($65,000 / $150,000) × $75,000 = $32,500Incorrect
Your answer is incorrect. The correct answer is “Product A: $42,500, Product B: $32,500” (option 3).
Computations and explanations:
Net realizable values:
Product A: (10,000 units × $10) – $15,000 = $85,000
Product B: (15,000 units × $ 5) – $10,000 = $65,000Joint cost allocation ratios and joint cost allocation using NRV method:
X: ($85,000 / $150,000) × $75,000 = $42,500
Y: ($65,000 / $150,000) × $75,000 = $32,500 -
Question 24 of 25
24. Question
Marshal Inc., manufactures two products, A and B, in a joint manufacturing process. Product A is sold for $10 and product B is sold for $5. In January, 10,000 units of product A and 15,000 units of product B were manufactured. The total joint cost in January was $75,000. The additional processing cost after split-off was $15,000 for product A and $10,000 for product B.
Based on the above data, the joint cost allocation to product A and product B under physical units method would be:
Correct
Awesome! Your answer is correct.
Computations and explanations:
Joint cost allocation ratios and joint cost allocation using physical units method:
Product A: (10,000 units / 25,000 units) × $75,000 = $30,000
Product B: (15,000 units / 25,000 units) × $75,000 = $45,000Incorrect
Your answer is incorrect. The correct answer is “Product A: $30,000, Product B: $45,000” (option 2).
Computations and explanations:
Joint cost allocation ratios and joint cost allocation using physical units method:
Product A: (10,000 units / 25,000 units) × $75,000 = $30,000
Product B: (15,000 units / 25,000 units) × $75,000 = $45,000 -
Question 25 of 25
25. Question
The quantitative unit cost method of joint cost allocation is also known as:
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