Suppose a Joint Process Yields 3 Main Products and One

question 37

Multiple Choice

Suppose a joint process yields 3 main products and one by-product that has no sales value and is disposed of in the normal garbage. Which of the following is appropriate in accounting for the by-product?

• A) Describe it in a footnote to the financial statements
• B) Allocate a portion of the joint cost to the by-product and show the amount in a loss account on the income statement
• C) Allocate a portion of the joint cost to the by-product and show the amount as a reduction of the processing costs of the main products
• D) None of the above; no accounting treatment is necessary

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Definitions:

Violation-of-expectation

A research method used in developmental psychology to study infants' understanding of the world by observing their reactions to events that contradict their expectations.

Tertiary Circular Reactions

A cognitive developmental stage in infants described by Piaget, involving the purposeful adaptation of established schemes to new situations.

Euthanasia

The practice of intentionally ending a life to relieve pain and suffering, often involving ethical and legal considerations.

Incurably Ill

A term describing a person suffering from a disease or condition that cannot be cured, often requiring long-term management or palliative care.