Two methods of allocating joint costs to products are physical measure allocation and monetary allocation.

Question

Quizplus · Accepted Answer

This statement is true. Joint costs refer to the costs incurred in the production of two or more products or services from a common input. Physical measure allocation and monetary allocation are two commonly used methods for allocating joint costs to products. Physical measure allocation involves allocating joint costs based on the physical quantity or volume of each product, whereas monetary allocation involves allocating joint costs based on the relative sales value or net realizable value of each product.

Two Methods of Allocating Joint Costs to Products Are Physical