India Corporation has $200,000 of joint processing costs and is studying whether to process J and K beyond the split-off point. Information about J and K follows.

J K

Tons produced 25,000 15,000

Separable costs beyond $90,00 $110,000

split-off point

Selling price per ton at 15 52

split-off point

Selling price per ton after 21 60

split-off point

1)If India desires to maximize total company income, what should the firm do with regard to Products J and K?

2)If India company uses the physical method for the allocation of joint costs, how much amount of cost should be allocated to Product K?

3) If India company uses the Sales value method for the allocation of joint costs, how much amount of cost should be allocated to Product J?