Allocated joint costs may make some products appear unprofitable even if they have positive sales value after split off.

Question

Quizplus · Accepted Answer

Joint costs are the costs incurred up to the split-off point in a process involving the production of multiple products. When these costs are allocated to the individual products, they can make some products appear unprofitable because the allocation may not reflect the actual market value or profitability of each product after the split-off point.

Allocated Joint Costs May Make Some Products Appear Unprofitable Even