The above chart was used by the G. E. T. Rich Co. for allocating $45,000 of joint costs incurred in March 19X7 for Department A.

During March the company had no ending inventory. No additional processing costs are incurred.

The G. E.T. Rich Co. uses a process cost system. hki4

Required:
If management decided to use the simple average output method to allocate joint cost, what would the joint cost allocation be?

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Gasoline Heating oils Kerosene Total market value of gallons sold (dollars) Market value per gallon (dollars) Beginning inventory (gallons) $40,000 $1.00 10,275 $28,500 $36,540 $0.60 $0.70 20,000 25,000