Use the following information for the next 2 questions.
A joint input costing $500 results in four distinct products at the point of split-off. Relevant data follows:
-Which joint cost allocation method may show a loss for a product with a large separable cost?
A) Sales value at split-off method
B) Realized value method
C) Net realizable value method
D) None of the above

Question

Use the following information for the next 2 questions.
A joint input costing $500 results in four distinct products at the point of split-off. Relevant data follows: 
-Which joint cost allocation method may show a loss for a product with a large separable cost?
A) Sales value at split-off method 
B) Realized value method 
C) Net realizable value method 
D) None of the above

Quizplus · Accepted Answer

The Net realizable value method allocates joint costs based on the final sales value minus separable costs, which can show a loss if the separable costs are high.

Use the Following Information for the Next 2 Questions