Which of the following statements about joint-cost allocation is false?
A) Joint-cost allocation is useful in deciding whether to further process a product after split-off.
B) Joint-cost allocation is useful in making a profit determination about individual joint products.
C) Joint-cost allocation is helpful in inventory valuation.
D) Joint-cost allocation can be based on the number of units produced.
E) Joint-cost allocation can be accomplished by using several different methods that focus on sales value and product "worth."

Question

Quizplus · Accepted Answer

Joint-cost allocation is not useful in deciding whether to further process a product after split-off because the decision should be based on the incremental costs and revenues associated with further processing, not on the allocated joint costs.

Which of the Following Statements About Joint-Cost Allocation Is False