Which of the following statements best define split off point in joint costing?
A) It is the point at which managers decide to discontinue one or more of the products.
B) It is the point at which the managers decide to outsource some of its production processes.
C) It is the juncture in a joint production process when two or more products become separately identifiable.
D) It is the juncture at which decisions determining joint costs of various products to be produced are taken.

Question

Quizplus · Accepted Answer

The split off point is the point in a joint production process at which two or more products become separately identifiable. At this point, joint costs can be allocated among the individual products based on their relative sales values or production costs. Choices A and B are not related to the concept of split off point. Choice D is partly correct, but it does not fully capture the essence of split off point as it does not consider the physical separation of the products.

Which of the Following Statements Best Define Split Off Point