Mathematics · Joint and By-Product Costing
A process produces two joint products A and B in equal physical quantities. A and B are sold at the split-off point for $5 per kg and $8 per kg respectively. There are no further costs after the split-off point. If joint costs are apportioned on a relative sales value basis, which of the following statements is TRUE?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The cost per kg of product A will be higher than that of product B
- 2The cost per kg will be the same for both products
- 3Product A will have the higher operating profit margin
- 4Both products will have the same operating profit margin✓
Correct answer
Both products will have the same operating profit margin
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