In case of joint products, the main objective of accounting of the cost is to apportion the joint costs incurred up to the split off point. For cost apportionment one company has chosen Physical Quantity Method. Three joint products ‘A’, ‘B’ and ‘C’ are produced in the same process. Up to the point of split off the total production of A, B and C is 60,000 kg, out of which ‘A’ produces 30,000 kg and joint costs are Rs 3,60,000. Joint costs allocated to product A is.

A. Rs 1,20,000

B. Rs 60,000

C. Rs 1,80,000

D. None of the these

Answer: Option C

Solution(By Examveda Team)

Joint costs allocated to product A is:
360000 × 30000/60000 = Rs. 180000.