Joint costs in different industries may be allocated using any of the following methods,except:

A) relative cubic footage of gases from a gas exploration process
B) relative sales values of fresh tomatoes,pulp tomatoes and tomato juice at the split-off point
C) relative sales value of maple wood planks,plywood,and chips (for smoking meat) at the split-off point
D) relative net realizable values at the split-off point of gold,silver,copper found in 100 tons of mining ore
E) All of the choices are correct

Question

PINAL RANDHESHIYA · Accepted Answer

Final Answer : E, Explanation :  All the choices provided (A through D) are legitimate methods of allocating joint costs in various industries. These methods involve allocating costs based on physical measures (like cubic footage in gas exploration) or value-based measures (like sales value or net realizable value at the split-off point in agriculture, lumber, and mining industries).

Definitions

Learning Objectives

Learning Objectives

Related questions