Firm X Has a Production Process That Has a Total

question 58

Multiple Choice

Firm X has a production process that has a total joint cost of $15,000.At the split-off point, there are 2,000 pounds of Product 1 and 3,000 pounds of Product 2.What is the cost per pound of Product 1 using the physical measure method?

• A)$2.50.
• B)$3.00.
• C)$3.50.
• D)$4.00.

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Definitions:

Inventory Flow Assumption

Pertains to the method used by a business to account for the order in which inventory is sold or used over time.

Beginning Inventory

The cost of merchandise on hand for sales at the commencement of an accounting cycle.

Cost Of Goods Sold

The immediate costs linked to the manufacture of products a business sells, involving material and labor costs.

Net Income

The earnings a company retains after removing all expenses and taxes from its revenue.