Use the Information Below to Answer the Following Question(s)

question 177

Multiple Choice

Use the information below to answer the following question(s) .Raynor 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)
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.Raynor Manufacturing's accounting department reported no beginning inventories; however, ending inventory amounts reflected 1,000 sheets of paper in stock.
-What are the paper's and the pencil's approximate weighted cost proportions using the sales value at splitoff method, respectively?

• A)28.57% and 71.43%
• B)33.33% and 66.67%
• C)40% and 60%
• D)49.00% and 51.00%
• E)50.00% and 50.00%

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Definitions:

Dollar Votes

The “votes” that consumers cast for the production of preferred products when they purchase those products rather than the alternatives that were also available.

Goods and Services

The physical items (goods) and activities or benefits (services) that are produced or provided to meet the needs and wants of consumers.

Entrepreneurial Ability

Refers to the capacity to innovate, introduce new products or services, improve processes, and manage business ventures effectively.

Economic Profit

The difference in overall financial returns and total operational expenditures, including both specific and assumed costs.