Which of the following is FALSE concerning the physical measure method?
A) Technical personnel outside of accounting may be required in the joint costing determinations.
B) Using the benefits-received criterion, the physical measure method less preferred than the sales at splitoff method.
C) The physical measure may not reflect each individual product's ability to generate revenues.
D) Using a common physical measure can result in the product with the lowest revenue-producing power having the most costs assigned to it.
E) It results in a constant gross margin for all products.

Question

Quizplus · Accepted Answer

The physical measure method does not result in a constant gross margin for all products, as it allocates joint costs based on physical measures rather than revenue or profitability.

Which of the Following Is FALSE Concerning the Physical Measure