The method of accounting for joint product costs that will produce the same gross margin percentage for all products is the:
A) replacement method.
B) physical quantities method.
C) net realizable value method.
D) units produced methoD.
Under net realizable value,the cost allocated is a constant percentage of the sales value so each product will have the same gross margin percentage.

Question

Quizplus · Accepted Answer

The net realizable value method is the method of accounting for joint product costs that will produce the same gross margin percentage for all products. Under this method, the cost allocated is a constant percentage of the sales value so each product will have the same gross margin percentage. This method is preferred over the other methods listed as it provides a more accurate reflection of the profitability of each product.

The Method of Accounting for Joint Product Costs That Will