By-products

From Wikicpa

Industries where multiple products are produced from the same raw materials and the same manufacturing process often produce by-products from the production process.

Example: In the lumber industry, the processing of a tree yields bark (used for fuel, engineered lumber or mulch) and natural lumber boards of various grades. Here the lumber prodcuts are the joint products and the bark is one the by-products.

An production item from the manufacturing process that has a significant market value compared to the total market value of all the products is considered a joint product. One that has a small market value compared to the total is a by-product.

Also see

Joint products