Laredo manufactures Nuts and Bolts from a joint process (cost = $70,000). 5,000 pounds of Nuts can be sold at split-off for $15 per pound; 10,000 pounds of Bolts can be sold at split-off for $10 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:

$30,000.

$35,000.

$45,000.

$70,000.

$40,000.