4. Progressive Manufacturing purchases trees from Tree Nursery and processes them up to the splitoff 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. Trees processed:50 trees (yield is 30,000 sheets of paper and 30,000 pencil casings and no scrap) Production: paper30,000 sheetspencil casings30,000 Sales: paper29,000 at $0.04 per pagepencil casings30,000 at $0.10 per casing Cost of purchasing 50 trees and processing them up to the splitoff point to yield 30,000 sheets of paper and 30,000 pencil casings is $1,500. Progressive Manufacturing's accounting department reported no beginning inventories; however, ending inventory amounts reflected 1,000 sheets of paper in stock. What is the paper's sales value at the splitoff point? Select one:a. $1,950b. $120c. $1,200d. $3,000e. $1,160

Split off point :— It is the point of separation of joint products into separate products. Joint…

Answered: Progressive Manufacturing purchases…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter10: Standard Costing And Variance Analysis

Section: Chapter Questions

Problem 34BEB

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4. Progressive Manufacturing purchases trees from Tree Nursery and processes them up to the splitoff 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.

Trees processed:

50 trees (yield is 30,000 sheets of paper and 30,000 pencil casings and no scrap)

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

Cost of purchasing 50 trees and processing them up to the splitoff point to yield 30,000 sheets of paper and 30,000 pencil casings is $1,500.

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

What is the paper's sales value at the splitoff point?

Select one:

a. $1,950

b. $120

c. $1,200

d. $3,000

e. $1,160

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