Use the following information for the next 8 questions.
RKH Corporation produces three joint products. During a recent accounting period, joint costs totaled $365 and RKH had no beginning inventories. Additional data appear below:
-Which of the following methods will result in the greatest total joint cost allocation among the three products? I. Net realizable value
II. Sales value at split-off point
III. Physical output
IV. Constant gross margin NRV
A) I and II only
B) II and III only
C) I and IV only
D) All methods will result in the same total joint cost allocated

Question

Use the following information for the next 8 questions.
RKH Corporation produces three joint products. During a recent accounting period, joint costs totaled $365 and RKH had no beginning inventories. Additional data appear below: 
-Which of the following methods will result in the greatest total joint cost allocation among the three products? I. Net realizable value
II. Sales value at split-off point
III. Physical output
IV. Constant gross margin NRV
A) I and II only 
B) II and III only 
C) I and IV only 
D) All methods will result in the same total joint cost allocated

Quizplus · Accepted Answer

All methods will result in the same total joint cost allocated because joint costs are fixed and must be fully allocated among the products, regardless of the method used. The methods only affect how the costs are distributed among the products, not the total amount allocated.

Use the Following Information for the Next 8 Questions