Grand Scarf Company manufactures 3 products using the same production process. The costs incurred up to the split-off point are RM20,000. These costs are allocated to the products on the basis of their sales value at the split-off point. Data for the operation is as below: Product Number of Units Produced Selling Price at Split-off (per unit) (RM) Selling Price after Processing (per unit) (RM) Additional Processing Costs (RM) Kate 2,000 6.20 11.00 11,000 Embun 3,000 7.70 12.50 8,000 Catalina 1,000 16.30 19.40 2,000 Instructions

Prepare an incremental analysis for the sell-or-process-further decision. (9 marks) Determine whether Grand Scarf Company should sell at split of point or process further. (1 mark)