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

question 5

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: Sales Values at
Product
Units Produced
Split-Off
A
14,000
£110,000
B
6,000
£90,000
Amos uses the physical units 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) £12,000; £28,000

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Definitions:

Credits

In accounting, credits are entries that decrease assets or increase liabilities and equity on a company's balance sheet.

Double-entry Bookkeeping System

A method of bookkeeping where every entry to an account requires a corresponding and opposite entry to a different account, ensuring the accounting equation is always in balance.

Fraud

A deliberate deception to secure unfair or unlawful gain, or to deprive a victim of a legal right.

Trial Balance

A bookkeeping report that lists the balances in each general ledger account at a specific time, ensuring that debits equal credits.