Question 2 (K2-7 Marks) Almarai Company processes raw milk up to the split-off point where two products, cream and liquid ski produced and sold. There was no beginning inventory. The following material was collected for the mor December 2021: Direct materials processed: 860,000 gallons (800,000 gallons of good product) Production: Cream 300,000 gallons Liquid skim 500,000 gallons Sales: Cream 250,000 at $140 per gallon Liquid skim 400,000 at $100 per gallon he cost of purchasing 860,000 gallons of direct materials and processing it up to the split-off point to y tal of 800,000 gallons of good product was $2,400,000. 1. If there are no additional processing costs incurred after the split off point, what is the amount cost allocated to each product on a sales value basis at split off? Compute the Company's 1 income. 3 marks 2. If additional processing costs beyond the split off point are $5 per gallon for Cream and $2 per g for Liquid skim, the sales price increased to be $150 per gallon for Cream and $115 per gallon f Liquid skim, what is the amount of joint cost allocated to each product on an estimated net realizable value basis? Compute the company's net income. 4 marks Question 2 (K2-7 Marks) Almarai Company processes raw milk up to the split-off point where two products, cream and liquid ski produced and sold. There was no beginning inventory. The following material was collected for the mor December 2021: Direct materials processed: 860,000 gallons (800,000 gallons of good product) Production: Cream 300,000 gallons Liquid skim 500,000 gallons Sales: Cream 250,000 at $140 per gallon Liquid skim 400,000 at $100 per gallon he cost of purchasing 860,000 gallons of direct materials and processing it up to the split-off point to y tal of 800,000 gallons of good product was $2,400,000. 1. If there are no additional processing costs incurred after the split off point, what is the amount cost allocated to each product on a sales value basis at split off? Compute the Company's 1 income. 3 marks 2. If additional processing costs beyond the split off point are $5 per gallon for Cream and $2 per g for Liquid skim, the sales price increased to be $150 per gallon for Cream and $115 per gallon f Liquid skim, what is the amount of joint cost allocated to each product on an estimated net realizable value basis? Compute the company's net income. 4 marks