The constant gross-margin percentage NRV method makes the simplifying assumption of treating the joint products as though they comprise a single product.

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The constant gross-margin percentage NRV method assumes that the joint products can be treated as a single product for the purpose of calculating the net realizable value and allocating joint costs. This simplification allows for a more straightforward calculation of profitability but may not reflect the varying contribution of each joint product to overall profitability.

The Constant Gross-Margin Percentage NRV Method Makes the Simplifying Assumption