The Berkel Corporation Manufactures Widgets, Gizmos, and Turnbols from a Joint

question 79

Multiple Choice

The Berkel Corporation manufactures Widgets, Gizmos, and Turnbols from a joint process. June production is 9000 widgets; 12,500 gizmos; and 14,500 turnbols. Respective per unit selling prices at split-off are $75, $50, and $25. Joint costs up to the split-off point are $188,000. What amount of joint costs will be allocated to the Gizmos? (Do not round any intermediary calculations.)

• A) $40,992
• B) $21,260
• C) $70,677
• D) $76,331

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Definitions:

Independent Contractor

An individual in business for themselves, who provides services to others under terms specified in a contract or agreement.

Control Over Work

The authority to direct and manage how a job or task is executed.

IRS Determination

An official decision made by the Internal Revenue Service on a specific tax matter.

Principal-Agent Relationship

A legal relationship where one party (the agent) acts on behalf of another party (the principal) in business transactions.