Laredo manufactures Nuts and Bolts from a joint process (cost = $72,000). 6,000 pounds of Nuts can be sold at split-off for $20 per pound; 10,000 pounds of Bolts can be sold at split-off for $15 per pound. For product costing purposes Laredo allocates joint costs using the relative sales value method.

The amount of joint cost allocated to Nuts would be:

$91,200.

$32,000.

$43,200.

$40,000.

$72,000.