How are byproducts costed in a company?
A) They are allocated a portion of the joint costs
B) They are allocated the selling price less any disposal costs
C) They are allocated a portion of the joint costs and any disposal costs
D) They are allocated the selling price
E) They are allocated the disposal costs

Question

Quizplus · Accepted Answer

Byproducts are typically valued at the net realizable value, which is the selling price less any costs necessary to make the byproduct ready for sale, including disposal costs if applicable. This method does not allocate joint costs to byproducts but rather focuses on the incidental revenue they generate after deducting the costs directly associated with their sale or disposal.

How Are Byproducts Costed in a Company