Amos, SA, Manufactures Products a and B from a Joint Process

question 37

Multiple Choice

Amos, SA., manufactures products A and B from a joint process. Joint product costs were £40,000 during the month of October. Additional information is as follows: $\begin{array}{lrr}&&\text { Sales Value at }\\\text { Product }&\text { Units Produced }&\text { Split-Off }\\\text { A } & 14,000 & £ 110,000 \\B & 6,000 & £ 90,000\end{array}$ Amos uses the sales-value-at-split-off method of joint cost allocation. What is the amount of joint product costs to be allocated to products A and B in October, respectively?

• A)£20,000; £20,000
• B)£22,000; £18,000
• C)£28,000; £12,000
• D)£18,000; £22,000

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Definitions:

Factory Depreciation

The decrease in value of manufacturing equipment and facilities over time due to wear and tear or obsolescence.

Return on Investment

A performance measure used to evaluate the efficiency of an investment or compare the efficiency of multiple investments.

Controllable Margin

Controllable Margin refers to the portion of profit or income that can be directly influenced by managerial decisions, excluding fixed costs and uncontrollable factors.

Investment Center

A division or unit within an organization that has control over its revenue, expenses, and invested capital, and is responsible for its profit and investment decisions.