Cost Management: A Strategic Emphasis 5th Edition by David Stout, Edward Blocher, Gary Cokins

Exercise 3

Explain the difference between joint products and by-products.

Step 1 of 2

Joint Product Costing:

Joint product costing refers to the costing of the production process where more than one unit is produced as a result of single manufacturing process. Joint product costing is generally seen in manufacturing industries only.

Example of joint product industry is petroleum industry which processes crude oil and it results into gasoline, kerosene, fuel oil etc.