ACCA-F2-PartB-12PPT課件

1、2021/7/241Chapter 11 Chapter 11 Process costing, joint products Process costing, joint products and by-productsand by-products2021/7/242Study guideDistinguish between by-products and joint products.kValue by-products and joint products at the point of separation. sPrepare process accounts in situati

2、ons where by-products and/or joint products occur. s2021/7/243Joint products and by-products1.1 Joint products P240Joint products are two or more products which are output from the same processing operationThey will be indistinguishable from each other up to their point of separation (split-off poin

3、t)2021/7/244They possess substantial sales value before or after further processingCosts incurred up to this point are called common costs or joint costs.Joint costs must be apportioned between the joint products2021/7/2451.2 Problems in accounting for joint productsHow common costs should be apport

4、ioned between products, in order to put a value to closing inventories and to the cost of sale (and profit) for each product.Whether it is more profitable to sell a joint product at one stage of processing, or to process the product further and sell it at a later stage.2021/7/2461.3 By-productsA by-

5、product is a supplementary or secondary product which arises as the result of a processThe value of a by-product is small relative to that of the principal product2021/7/247What exactly separates a joint product from a by-product?A joint product is regarded as an important saleable item, and so it s

6、hould be separately costed. The profitability of each joint product should be assessed in the cost accounts.A by-product is not important as a saleable item, and whatever revenue it earns is a bonus for the organisation. Because of their relative insignificance, by-products are not separately costed

7、.Joint costs do not allocate to a by-product2021/7/2482. Dealing with common costsThere are two main methods of apportioning joint costs physical measurement or sales value at split-off point2021/7/2492.1 Physical measurementCosts apportioned on basis of proportion of output to the total outputThis

8、proportion can be based upon weight or volume2021/7/2410Physical units basis useful where:The joint products are in the same form, e.g. both solids or both liquidsThe joint products are components in another product and therefore have no relevant sales value.Limitations: This method does not take in

9、to account the relative income-earning potentials of the individual products, with the result that one product might appear very profitable and another appear to be incurring losses.2021/7/24112.2 Sales value method Costs apportioned in proportion of sales value of joint product to total sales value

10、 of outputThe relative sales value method is the most widely used method of apportioning joint costs because (ignoring the effect of further processing costs) it assumes that all products achieve the same profit margin. With relative sales value apportionment of common costs, the cost is allocated a

11、ccording to the products ability to produce income. 2021/7/24123. Accounting for by-productsSales income (minus any post-separation further processing or selling costs) may be added to sales of the main product. Sales income may be treated as a separate, incidental source of income against which are

12、 set only post-separation costs. Sales income may be deducted from the cost of production or cost of sales of the main product.The net realisable value may be deducted from the cost of production of the main product. The net realisable value is the final saleable value minus any post-separation cost

13、s. If by-product usual occurrenceIf by-product be a one-offP247. Example: methods of accounting for by-products2021/7/2413Chapter roundupJoint products are two or more products separated in a process, each of which has a significant value compared to the other. A by-product is an incidental product

14、from a process which has an insignificant value compared to the main product.The point at which joint and by-products become separately identifiable is known as the split-off point or separation point. Costs incurred up to this point are called common costs or joint costs.2021/7/2414The main methods

15、 of apportioning joint costs, each of which can produce significantly different results are as follows: physical measurement; and relative sales value apportionment method; sales value at split-offThe relative sales value method is the most widely used method of apportioning joint costs because (ignorin