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27% | 00:47 All File Reader Q Q Question 8 (15 Marks, 27 Minutes) Normal 2018 ABC is in the manufacturing sector and produces products Xo, Yo and Zo from a single production process. Xo and Yo are processed further before they can be sold and Zo is incidental to the production process, therefore it is sold to a local farmer who uses it to fertilize his soil. The by-product is sold immediately for N$6 per unit and the selling prices after further processing of Xo and Yo are N$65 and N$75, respectively. The following relates to the month of November: Joint costs for 2 500 unit of Xo, 3 500 units of Yo and 3 000 units of Zo are as follows: Material (5 000 kg at N$25 p/kg) Labour: N$32 500 Overheads are applied at N$1.75 for every kg of material used. Each final product loses 20% of the input as the company processes Xo and Yo further, costs of processing Xo and Yo further are: N$23 500 for all 2 500 units of Xo N$35 500 for all 3 500 units of Yo It is the practice of the company to reduce joint costs with the net income from a product, if any. Marks 1 REQUIRED: 8.1 Distinguish between a joint and a by-product. 8.2 Calculate total joint costs to be allocated to the joint products. Allocate joint costs according to the Constant gross profit percentage method. TOTAL MARKS FOR QUESTION 8 5 8.3 9 15 Question 9 (15 Marks, 27 Minutes) Supp 2018 Rosenberg Pty Ltd, is located in the southern part of Namibia, the company buys grapes from Ousinker in the Hardap district. The grapes are processed to yield Wine, Grape Juice and Raisins. During August 2018, 3 tons of grapes were bought. The grapes cost N$ 4 000 per ton. Ousinker usually charge a fixed rate of N$ 1 000 per ton to deliver the grapes. The skins of the grapes are removed during the manufacturing process. The skins are sold to a farmer in the surrounding area as feed for pigs. The selling price of the skins is N$ 5 per kilogram, after additional packaging cost of N$ 1 per kilogram has been incurred. Page 20 of 71 PREVIOUS NEXT

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