Reference no: EM132750112

Seattle Manufacturing purchases trees from Cascade Lumber and processes them up to the split off point where two products (paper and pencil casings) are obtained. The products are then sold to an independent company that markets and distributes them to retail outlets.

The following information was collected for the month of November:

Production: 100 trees produced to yield
paper 60,000 sheets
pencil casings 60,000
Sales: paper 58,000 at $0.08 per page
pencil casings 55,000 at $0.20 per casing

Problem 1: Cost of purchasing 100 trees and processing them up to the split off point to yield 60,000 sheets of paper and 60,000 pencil casings is $8000. If the physical units method is used to allocate joint costs. How much joint costs are allocated to the paper and pencil casings respectively

Select one:

a. 4000 and 4000
b. 5800 and 2200
c. 5000 and 3000
d. 3000 and 5000