Multiple choice

Directions: Choose the correct option for the given question.

Under ______ method of accounting of by-products, the sale value of by-product is credited to profit and loss account.

  1. sales value

  2. other income

  3. market value

  4. cost price

  5. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

When the sale value of a by-product is treated as other income, it is credited directly to the profit and loss account rather than being used to reduce the cost of the main product.

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