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

question 128

Multiple Choice

Denise 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 X?

• A) $70,000
• B) $87,500
• C) $125,000
• D) $250,000

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Definitions:

Redistributive Exchange

An economic system where goods or resources are collected from a group and then distributed based on a specific set of criteria.

Tribute

Payment made periodically by one state or ruler to another, especially as a sign of dependence or submission.

Political Organization

The way power, as the capacity to do something, is accumulated, arranged, executed, and structurally embedded in society; the means through which a society creates and maintains social order and reduces social disorder.

Uncentralized Political System

A form of governance where power or legal authority is dispersed among various levels of government or organizations rather than being centralized in a single authority.