Joint products and by-products are produced simultaneously by a single process or series of processes and:
A) joint products are salable at the split-off point,but by-products are not.
B) by-products are salable at the split-off point,but joint products are not.
C) the revenue from by-products may be recognized at the time of production.
D) all by-products must be allocated some portion of joint costs.

Question

Quizplus · Accepted Answer

By-products can be salable at the split-off point and their revenue can be recognized at the time of production. Joint costs must be allocated to all products, including by-products, to determine their true profitability. However, joint products are not necessarily salable at the split-off point, and there is no requirement that by-products be allocated any portion of joint costs. Therefore, option A and B are incorrect, and option D is partially correct but not complete.

Joint Products and By-Products Are Produced Simultaneously by a Single