Relative Sales Value at Split off Method: Relative sales value at split off method allocates joint cost on the basis of sum total of sales value at the split off point. Net Realizable Value (NRV) Method: NRV method is a method of joint cost allocation which takes into consideration additional costs required to be incurred in the further processing of the products. To identify: Situation where NRV method can be used but not sales value at split off method.

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Chapter 16, Problem 16.7Q

To determine

Relative Sales Value at Split off Method:

Relative sales value at split off method allocates joint cost on the basis of sum total of sales value at the split off point.

Net Realizable Value (NRV) Method:

NRV method is a method of joint cost allocation which takes into consideration additional costs required to be incurred in the further processing of the products.

To identify: Situation where NRV method can be used but not sales value at split off method.

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