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Question
When two or more products come out of a single raw material which is equally important, are referred to as __________.
When two or more products come out of a single raw material which is equally important, are referred to as __________.
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Solution
The correct option is D Joint products
Joint products are multiple product generated by a single production process. They can not be differentiated until a split off point. The materials used in the production of such materials are the same and no allocation is required to be made of the materials between such joint products.Thereafter, a separate cost is incurred to process it further. Prior to the split off, the cost incurred can be considered as joint cost for the joint products.
Joint products are multiple product generated by a single production process. They can not be differentiated until a split off point. The materials used in the production of such materials are the same and no allocation is required to be made of the materials between such joint products.Thereafter, a separate cost is incurred to process it further. Prior to the split off, the cost incurred can be considered as joint cost for the joint products.
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