Joint Product vs. By Product — What's the Difference?
By Tayyaba Rehman — Published on October 1, 2023
Joint Products are main products derived simultaneously from a process, while By Products are secondary outputs of lesser value.
Difference Between Joint Product and By Product
Table of Contents
ADVERTISEMENT
Key Differences
In industries like petroleum, Joint Products might include gasoline and diesel, both emerging from the refining of crude oil and holding significant market value. On the other hand, By Products like paraffin wax, while valuable, aren't the primary focus of the refining process.
Tayyaba Rehman
Oct 01, 2023
It's essential to understand that the distinction between Joint Product and By Product isn't necessarily about quantity. It's more about the relative importance and the economic value of the outputs. For example, in meat processing, both meat cuts and hides can be considered Joint Products, while bones used for broth might be seen as By Products.
Tayyaba Rehman
Oct 01, 2023
The allocation of costs in accounting varies for Joint Products and By Products. Joint Products often involve an allocation of joint costs based on some consistent basis like weight or sales value. By Products, conversely, might have their revenue treated as a deduction from the total joint costs.
Tayyaba Rehman
Oct 01, 2023
Marketing and sales strategies for Joint Products and By Products also diverge. Joint Products often have dedicated marketing campaigns, whereas By Products might be sold in niche markets or even given away if the cost of processing isn't justified by potential revenue.
Tayyaba Rehman
Oct 01, 2023
Joint Product and By Product both originate from a singular production process. However, while the Joint Product is one of the main products produced intentionally and has a significant value, the By Product is an incidental output with relatively lesser importance and value.
Tayyaba Rehman
Oct 01, 2023
ADVERTISEMENT
Comparison Chart
Importance
Main product with significant value.
Secondary product with lesser value.
Tayyaba Rehman
Oct 01, 2023
Economic Value
Generally high economic value.
Relatively lower economic value.
Tayyaba Rehman
Oct 01, 2023
Cost Allocation
Joint costs allocated based on weight/value.
Revenue might offset joint costs.
Tayyaba Rehman
Oct 01, 2023
Marketing Strategy
Dedicated marketing campaigns.
Niche markets or minimal marketing.
Tayyaba Rehman
Oct 01, 2023
ADVERTISEMENT
Definitions
Joint Product
Co-primary products with notable market value.
In the sugar industry, sugar and molasses are viewed as Joint Products.
Tayyaba Rehman
Sep 30, 2023
By Product
Incidental product with lesser market value.
Glycerin is a By Product in soap manufacturing.
Tayyaba Rehman
Sep 30, 2023
Joint Product
Significant outputs sharing joint costs.
When extracting metal ores, different metals can become Joint Products.
Tayyaba Rehman
Sep 30, 2023
By Product
Output not central to the main production goal.
In milling, bran is often considered a By Product.
Tayyaba Rehman
Sep 30, 2023
Joint Product
Products of equal importance from a singular process.
In meat processing, meat and hides can be considered Joint Products.
Tayyaba Rehman
Sep 30, 2023
By Product
Product with value, but not the primary focus.
While processing fish, fish oil is typically a By Product.
Tayyaba Rehman
Sep 30, 2023
Joint Product
A main output from a shared production process.
Gasoline and diesel are Joint Products from oil refining.
Tayyaba Rehman
Sep 30, 2023
By Product
A secondary output from a production process.
Paraffin wax is a By Product of oil refining.
Tayyaba Rehman
Sep 30, 2023
Joint Product
Multiple primary goods produced simultaneously.
In dairy, cheese and butter can emerge as Joint Products.
Tayyaba Rehman
Sep 30, 2023
By Product
A secondary product; something made incidentally during the production of something else.
Tayyaba Rehman
Sep 29, 2023
By Product
A side effect.
The many Indian restaurants all over Britain are a by-product of the large waves of immigration from the subcontinent.
Tayyaba Rehman
Sep 29, 2023
By Product
A secondary or additional product; something produced, as in the course of a manufacture, in addition to the principal product.
Tayyaba Rehman
Sep 29, 2023
By Product
Unintended yield from primary production.
In wine-making, grape seeds emerge as a By Product.
Tayyaba Rehman
Sep 30, 2023
FAQs
How are joint costs allocated to Joint Products?
Costs are usually allocated based on weight, volume, or sales value.
Tayyaba Rehman
Oct 01, 2023
Can both Joint Products and By Products be profitable?
Yes, both can be profitable, but Joint Products often have higher economic value.
Tayyaba Rehman
Oct 01, 2023
What's a key difference between Joint Product and By Product?
Joint Product is a main output with high value, while By Product is a secondary output with lesser value.
Tayyaba Rehman
Oct 01, 2023
Can the status of By Products change over time?
Yes, with market demand or innovative uses, By Products can gain significance.
Tayyaba Rehman
Oct 01, 2023
Why are Joint Products significant in accounting?
They require allocation of joint costs, affecting profitability analysis.
Tayyaba Rehman
Oct 01, 2023
Are By Products always produced in smaller quantities?
Not necessarily. It's more about economic value than quantity.
Tayyaba Rehman
Oct 01, 2023
How are By Products typically marketed?
They might target niche markets, have minimal marketing, or even be given away.
Tayyaba Rehman
Oct 01, 2023
Are Joint Products always intentional?
Generally, yes. They are intentionally produced for market demand.
Tayyaba Rehman
Oct 01, 2023
How do companies decide on producing Joint Products?
It's based on market demand, production feasibility, and profitability.
Tayyaba Rehman
Oct 01, 2023
Can a By Product become a Joint Product?
If its economic importance grows, a By Product can become a Joint Product.
Tayyaba Rehman
Oct 01, 2023
Do all industries produce By Products?
Not all, but many industries have processes that yield By Products.
Tayyaba Rehman
Oct 01, 2023
Is the distinction between Joint Product and By Product always clear?
No, it can be subjective, based on market dynamics and company perspectives.
Tayyaba Rehman
Oct 01, 2023
Can a By Product be a waste product?
Not necessarily. While some By Products can be waste, many have economic value.
Tayyaba Rehman
Oct 01, 2023
Are By Products always sold?
Not always. Some might be recycled, reused, given away, or discarded.
Tayyaba Rehman
Oct 01, 2023
Do Joint Products always share the same production process?
Yes, they emerge from the same process, which incurs joint costs.
Tayyaba Rehman
Oct 01, 2023
Author Spotlight
Written by
Tayyaba RehmanTayyaba Rehman is a distinguished writer, currently serving as a primary contributor to askdifference.com. As a researcher in semantics and etymology, Tayyaba's passion for the complexity of languages and their distinctions has found a perfect home on the platform. Tayyaba delves into the intricacies of language, distinguishing between commonly confused words and phrases, thereby providing clarity for readers worldwide.
