Braun Company Produces Two Chemical Compounds,Herzog and Lomax from a Joint

Multiple Choice

Braun Company produces two chemical compounds,Herzog and Lomax from a joint process.Joint costs to produce 500 gallons of Herzog and 300 gallons of Lomax were $80,000.A by-product,Horst,results from the joint process and has a market value of $1,000.Assuming Braun accounts for the by-product as a reduction in the costs assigned to the products,what are the joint costs assigned to Herzog?

A) $39,500
B) $49,375
C) $50,000
D) $40,000