The Green Company processes unprocessed goat milk up to the split-off point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October: Direct materials processed: 103,000 gallons (after shrinkage) Production: Condensed goat milk 46,000 gallons Skim goat milk 57,000 gallons Sales: Condensed goat milk $4.50 per gallon Skim goat milk $3.75 per gallon The costs of purchasing the of unprocessed goat milk and processing it up to the split-off point to yield a total of 103,000 gallons of saleable product was $188,480. There were no inventory balances of either product. Condensed goat milk may be processed further to yield 45,500 gallons (the remainder is shrinkage) of a medicinal milk product, Xyla, for an additional processing cost of $5 per usable gallon. Xyla can be sold for $21 per gallon.

Skim goat milk can be processed further to yield 55,700 gallons of skim goat milk ice cream, for an additional processing cost per usable gallon of $5. The product can be sold for $10 per gallon. There are no beginning and ending inventory balances.

What is the estimated net realizable value of Xyla at the split-off point? Select one: a. $278,500 b. $285,000 c. $728,000 d. $736,000