McKnight Petroleum has spent $205,000 to refine 61,000 gallons of petroleum distillate, which can be sold for $6.10 per gallon. Alternatively, McKnight can process the distillate further and produce 55,000 gallons of cleaner fluid. The additional processing will cost $1.65 per gallon of distillate. The cleaner fluid can be sold for $9.20 per gallon. To sell cleaner fluid, McKnight must pay a sales commission of $0.13 per gallon and a transportation charge of $0.15 per gallon. Read the requirements. Requirement 1. Fill in the diagram for McKnight's alternatives. Joint costs of producing 61,000 gallons of petroleum distillate Revenues from selling as is Cost of Revenues from processing further A processing further ... Requirements 1. Fill in the diagram for McKnight's alternatives. 2. Identify the sunk cost. Is the sunk cost relevant to McKnight's decision? 3. Should McKnight sell the petroleum distillate or process it into cleaner fluid? Show the expected net revenue difference between the two alternatives.