In case of Joint Products, the cost incurred upto the point where individual product can be identified is called

The correct answer is - Joint cost

Key Points

• Joint cost
  • This is the cost incurred up to the split-off point where individual products can be identified.
  • It is crucial in joint production processes where multiple products are produced simultaneously.
  • The allocation of joint costs to individual products is essential for accurate cost accounting.

Additional Information

• Prime cost
  • Prime cost refers to the direct costs of production, such as direct materials and direct labor.
  • It does not include overhead costs or joint costs.
• Average cost
  • Average cost is calculated as total cost divided by the number of units produced.
  • It is used to determine the per-unit cost of production.
• Separation cost
  • Separation cost refers to the costs incurred to separate joint products into individual products.
  • It is different from joint cost, which is incurred before the split-off point.