Under the net realizable method of allocating joint costs, which of the following equations is used to compute the value of products processed beyond the split-off point?
A)Net Realizable Value = Selling Price at Split-Off × Quantity
B)Net Realizable Value = (Final Selling Price × Quantity) + Additional Processing Costs
C)Net Realizable Value = (Final Selling Price × Quantity) - Additional Processing Costs
D)Net Realizable Value = (Final Selling Price × Quantity) ÷ Additional Processing Costs

Question

Quizplus · Accepted Answer

The net realizable value under the net realizable method of allocating joint costs for products processed beyond the split-off point is calculated by taking the final selling price of the product, multiplying it by the quantity, and then subtracting any additional processing costs incurred after the split-off point.

Under the Net Realizable Method of Allocating Joint Costs, Which