The problematic of imputing joint costs in management accounting for organisations: reviewing state of the art practices

The objective of this article is to refocus the debate on the problematic of identifying the distribution of joint costs resulting from co-products produced by organisations. Starting with a summary of the theoretical analytical tools that exist on the subject, we have attempted to reengage the preoccupation of organisational managers regarding the allocation of joint costs. Reviewing the state of art has allowed us to distinguish two allocation logics for the joint cost of co-products. The first logic is based on market data while the second is more oriented towards physical data or material measurements. Considering the stated objective of joint cost allocation in manufacturing, using numerical examples, we have examined different methods of joint cost allocation, all the while showing the particularities of each type. However, the complexity and the subjectivity of joint cost allocation for co-products leaves us to believe that, while it is important to choose a particular method by taking into account the stated objectives, one must still remain sufficiently cautious before sanctioning any decision making necessary for performance evaluation in situations that infer the joint cost allocation for manufacturing.