PROCESS COSTING JOINT AND BY-PRODUCTS

Introduction

"Joint products and by-products"
Dealing with common costs
Joint Products in process accounts
"Accounting for by-products"

In it

Distinguish between by-products and joint products
"Value by-products and joint products at the point of separation"
Prepare process accounts in situations where by-products and/or joint products occur

Simple searches

Define:Process Costing
Define:Weighted Average Process Costing
Define:Fifo process costing
Worksheet of process costing questions
Dealing with common costs in process costing

Just guessing

Process costing: Costs calculating system for processes. e.g Industrial process etc. (blame me if wrong)

Process costing can have two types of products separated in the process .
1. Joint and 2. By-product

Joint products are those products one or two whatever the output of a process results in. The output products both have saleable (value gained on sale) value and both are different from each other. e.g. Oil-refining process gives petrol and paraffin both have high saleable value.

By-product as it's name suggests is an extra product that arises as a result of a process of a making a main/principal product. The by-product has a low saleable value as compared to the main product under production e.g. timber industry - gives sawdust and bark which has very low saleable value as compared to timber itself.

Don't have a clue! Blame me. I confess to all the blames.