Chapter 12: Decision to Sell or Process Further Big Oil refines petroleum, commonly known as crude oil. One joint product, kerosene, may be processed further (distillation) to produce gasoline. The distillation (heating) process causes evaporation, and therefore, loss of product. Construct a differential analysis showing the differential net income or loss of processing one batch of kerosene into gasoline. (Use table below) Should kerosene be processed further? Kerosene production Gasoline production Input batch size 6,000 gallons Batch size Cost to produce $2,400 per batch Selling price 6,000 gallons (6,000 x 20%) Less evaporation (20%) Output batch size Additional processing costs Selling price 4,800 gallons $1,650 per batch $2.50 per gallon $1.50 per gallon