Question 2 Jarxo plc manufacture four products which originate from a single process and are further processed into separate products. Joint costs from the first process are calculated to be 280,000 and are currently allocated to the products on the basis of the quantity produced in metres. The latest data is for the month of May and is shown below: Product Kitty Maya Josey Freya Selling Price at the end of the first 35/m 14/m 18/m 24/m process (per metre) Selling Price after further processing 88/m 50/m 22/m 44/m (per metre) Costs Post-separation Point 185,000 115,000 130,000 150,000 Output in metres 6,500 3,500 6,400 7,600 H Required: a) Explain the difference between the accounting treatment methods for allocating joint costs, Physical Measure and Gross Profit Percentage (2 marks) b) Prepare a statement of estimated profit or loss for each product and in total for the month of May if all four products are processed further, using the Sales Value at Split-off Methods. (8 marks) c) Suggest and explain an alternative approach to the allocation of costs at the "split-off point and assess the effect this would have on the profitability of each product (6 marks) d) Should product Josey be further processed beyond the "split-off point or should it be sold to customers before further processing? (4 marks)