Kemp Company Manufactures Three Products from a Joint Process Assume the Relative-Sales-Value Method of Allocating Joint Costs Is Used

question 130

Multiple Choice

Kemp Company manufactures three products from a joint process.Joint costs for the year amounted to $250,000.The following data was available:
$$\begin{array} { l l l } \text { Product } & \text { Units Produced } & \text { sales Value at Split-off } \\\hline X& 5,000 & \$ 70,000 \\Y & 3,000 & \$ 30,000 \\Z & 2,000 & \$ 100,000\end{array}$$
Assume the relative-sales-value method of allocating joint costs is used.What amount of joint costs is allocated to Product Y?

• A) $30,000
• B) $37,500
• C) $75,000
• D) $250,000

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Definitions:

Actual Values

The real, measured values obtained from data collection as opposed to predicted or estimated figures.

Unusual Events

Occurrences that deviate significantly from the norm, which can impact operations, finances, or safety in various contexts.

Mean Absolute Deviation

A measure of variability that shows the average distance between each data point and the mean of the data set.

Correlation Coefficient

A statistical measure that calculates the strength and direction of a linear relationship between two quantitative variables.