Which of the following joint cost allocation methods should be used for decision making?
A) Physical output method
B) Net realisable value method
C) Sales value at split-off point method
D) Joint costs are irrelevant for most decisions

Question

Quizplus · Accepted Answer

Joint costs are sunk costs and are irrelevant for decision making. Decisions should be based on future costs and revenues, not on costs that have already been incurred and cannot be recovered.

Which of the Following Joint Cost Allocation Methods Should Be