In deciding whether to sell a joint product or to process it further, any costs incurred prior to the split-off point are sunk costs and are, therefore, irrelevant costs.

Name: In deciding whether to sell a joint product or to process it further, any costs incurred prior to the split-off point are sunk costs and are, therefore, irrelevant costs.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Joint costs are sunk costs that are irrelevant because they are not affected by the decision regarding possible further processing of a joint product.

In Deciding Whether to Sell a Joint Product or to Process