Which of the following would be least relevant in deciding whether to further process a joint product past the split-off point?
A) Incremental revenue earned from additional processing.
B) Incremental costs incurred as a result of additional processing.
C) Joint costs allocated to the joint product at the split-off point.
D) Customer demand for the product that emerges from additional processing.

Question

Quizplus · Accepted Answer

Joint costs allocated to the joint product at the split-off point are irrelevant in deciding whether to further process a joint product past the split-off point because these costs have already been incurred, and therefore cannot be changed by the decision to further process the product. A and B are relevant as they relate to the incremental revenues and costs associated with further processing, while D is relevant as it relates to customer demand for the product.

Which of the Following Would Be Least Relevant in Deciding