In manufacturing, a joint cost is an expense incurred to produce multiple products or processes

at the same time. These costs are typically traced back to a point in the production process
where the resulting products become distinct, called the split-off point. Common examples of
joint costs include raw materials, labor, and overhead incurred before the split-off point.
Here's a breakdown of key points about joint costs:
● They apply to situations where one production process yields several outputs.
● These outputs are usually linked or interdependent.
● It's difficult to directly assign the joint cost to each individual product because they
benefit from the same initial processes.
● Manufacturers allocate joint costs using various methods to determine individual product
costs for pricing, inventory management, and profitability analysis.
Joint costs are a fundamental concept in cost accounting, as they impact how companies
account for production expenses and ultimately influence their pricing strategies.