Sherman Company Produces Two Main Products Jointly, a and B

question 13

Essay

Sherman Company produces two main products jointly, A and B, and C, which is a by-product of B.
Costs before separation are apportioned between the two main products by the net realizable value method. The net revenue realized from the sale of C is deducted from the cost of B. A and B are produced from the same raw material. C is manufactured from the residue of the process creating B. Data for April were as follows:
Required: Determine the gross profit for April.

---

Definitions:

Throughput Standards

Benchmarks or measures used to evaluate the efficiency of a process by assessing the amount of output produced over a given period of time.

Actual Performance

The real, observed output or results of an individual, organization, or system’s activities.

Desired Performance

The expected or targeted level of output or efficiency from a process, employee, or system.

Control Equation

A conceptual framework or formula used to manage and regulate processes or systems to ensure desired outcomes are achieved.