Which of the following statements regarding by-products is FALSE?
A) A by-product is not individually identifiable until the split-off point.
B) A by-product is the same as a joint product.
C) By-products have relatively insignificant total sales value.
D) Only separable costs are allocated to by-products.

Question

Quizplus · Accepted Answer

By-products and joint products are two distinct concepts in cost accounting. A by-product is a secondary product that arises from the production process but does not have significant sales value or importance, while a joint product is a primary product that yields multiple products of significant value. By-products are not the same as joint products.

Which of the Following Statements Regarding By-Products Is FALSE