How Does the Physical-Measure Method Allocate Joint Costs

question 11

Multiple Choice

How does the physical-measure method allocate joint costs?

• A) allocates joint costs to joint products in a way that each product has an identical gross-margin percentage
• B) allocates joint costs to joint products on the basis of a comparable physical measure at the split-off point
• C) allocates joint costs to joint products on the basis of the relative sales value at the split-off point
• D) allocates joint costs to joint products on the basis of relative NRV

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