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Molo Oil Company produces gasoline, home heating oil, and jet fuel from crude oil in a joint processing operation. Joint processing costs up to the

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Molo Oil Company produces gasoline, home heating oil, and jet fuel from crude oil in a joint processing operation. Joint processing costs up to the split-off point total $315,000 per month. For financial reporting purposes, the company allocates these costs to the joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Monthly Product Selling Price Output Gasoline $13.00 per gallon 11,600 gallons Heating $7.00 per gallon 18,200 gallons Jet Fuel $19.00 per gallon 2,800 gallons Each product can be processed further after the split-off point, Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below. Additional Processing Selling Product Costa $54,640 $17.40 per gallon Oil $77.580 $12.40 per gallon Jet Fuel $29,360 $26.40 per gallon Price Gasoline Heating Required: 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? 2. Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further? Complete this question by entering your answers in the tabs below. Required: Required 2 What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point? Gasoline Home Hoating on Financial advantago (disadvantago) of further processing Jet Fuel Based on your analysis in requirement 1, which product or products should be sold at the split-off point and which product or products should be processed further? Home Gasoline Jet Fuel Heating Oil Sell at split-off point? Process further

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