Renkas Oil & Gas, a large energy conglomerate, jointly processes purchased hydrocarbons to generate three nonsalable intermediate products: ICR8, ING4, and XGE3. These intermediate products are further processed separately to produce crude oil, natural gas liquids (NGL), and natural gas (measured in liquid equivalents). (Click the icon to view the overview.) A federal law that has recently been passed taxes crude oil at 30% of operating income. No new tax is to be paid on natural gas liquid or naturals i (Click the ic 0 Overview of the process and results. Read the require Requirement 1. Allocate the August 2017 joint cost among the three products using the (a) Physical-measure method and (b) NRV method. First, allocate the August 2017 joint cost using the physical-measure method. (Round the weights to five decimal places and joint costs to the Crude Oil NGL Gas Total Physical measure of total production Weighting Joint costs allocated An overview of the process and results for August 2017 are shown here (Note: The numbers are small to keep the focus on key concepts.) Joint Costs Separable Costs $1,700 Crude Oil Processing ICR8 200 barrels @ $175 $20 per barrel Hydrocarbons Processing Processing ING4 NGL 100 barrels @ $19 per barrel $120 Requirements XGE3 Processing $195 Natural Gas 700 eqvt. barrels $1.20 per eqvt. baru 1. i More Info Print Done 2. Allocate the August 2017 joint cost among the three products using the following: a. Physical-measure method b. NRV method. Show the operating income for each product using the methods in requirement 1. Discuss the pros and cons of the two methods to Renkas Oil & Gas for making decisions about product emphasis (pricing, sell-or-process- further decisions, and so on). Enter any number in the ed Starting August 2017, Renkas Oil & Gas must report a separate product-line income statement for crude oil. One challenge facing Renkas Oil & Gas is how to 3. 4 parts beginning or ending inventory. Check Answer 4 remaining Waiting for www.mathxl.com