Company X uses a joint processing system for it's 2 products Y & Z. As a result of using the physical volume method of joint cost allocation instead of the net realizable value method, they have overstated the unit cost for product Z and understated the unit cost for product Y. If Company X prepares separate financial statements for each of the 2 products, which of the following statements is true Question 19 options:

There will be no effect on the Income Statements for either Y or Z

Net Income for product Y will be overstated

COGS for product Z will be overstated

Gross Margin for product Z will be overstated