BP Oil processes cornmash up to the splitoff point where two products, ethanol and moonshine are created. The following information was collected for the month:

Direct Materials processed: 45,000 gallons (after shrinkage)

Production: Ethanol 28,000 gallons

Moonshine 17,000 gallons

Sales: Ethanol $4.00 per gallon

Moonshine $10.00 per gallon

The costs of purchasing the cornmash and processing it up to the splitoff point to yield a total of 45,000 gallons of saleable product was $200,000. There were no inventory balances of either product.

Ethanol may be processed further to yield 20,000 gallons (the remainder is shrinkage) of Premium Ethanol, for an additional processing cost of $2.00 per usable gallon. Premium Ethanol can be sold for $6.00 per gallon.

Moonshine can be processed further to yield 10,000 gallons of rocket fuel, for an additional processing cost per usable gallon of $8. The product can be sold for $100 per gallon.

There are no beginning and ending inventory balances.

What is the net realizable value of rocket fuel at splitoff?

Group of answer choices

A. $1,000,000

B. $920,000

C. $1,700,000

D. $170,000