Abstract The author of this article critically examines joint analysis as an aid to management. He refers to a paper by Professor Arthur N. Loring, titled "Joint Cost Analysis as an Aid to Management," published in the journal, "The Accounting Review," in which the results of the analysis is given. The author enumerates the proposals made by Loring to ascertain the existence of the conditions arrived at by applying the analysis. The proposals are to, compute a percentage gross margin for the product group, application of the percentage to the sales value production, to deduct the result in each case from the product's sales value and to compare the remainder with the unique processing cost necessary to render the product salable. The author comments that prescribed methods may yield negative joint allocations to some products and that Loring's proposals and statements are not complete and that he has failed to demonstrate that any method of joint cost analysis is in itself useful for managerial decision-making.
T. M. Hill (Sun,) studied this question.