What the pencil casings sales value at the split-off point

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Reference no: EM132972429

Question - Raynor Manufacturing purchases trees from Tree Nursery 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 October.

Production:

paper: 30,000 sheets

pencil casings: 30,000

Sales:

paper: 29,000 at $0.04 per page

pencil casings: 30,000 at $0.10 per casing

The cost of purchasing 50 trees and processing them up to the split-off point to yield 30,000 sheets of paper and? 30,000 pencil casings is $1,500.

Raynor Manufacturing's accounting department reported no beginning inventories; however, ending inventory amounts reflected 1,000 sheets of paper in stock.

What are the pencil casings' sales value at the split-off point?

Reference no: EM132972429

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