1. Shell Corporation refines crude oil into gasoline and diesel using process costing. In July 2035, the company processes 100,000 barrels of crude oil costing $5,000,000. The refining process yields:
   • Gasoline: 60,000 barrels costing $3,000,000
   • Diesel: 40,000 barrels costing $2,000,000

Required:

• Allocate joint costs using the physical units method.
• Calculate the cost per equivalent unit for gasoline and diesel.
• Allocate joint costs using the net realizable value method.
• Determine the total joint production costs allocated to gasoline and diesel.
• Prepare the income statement for the refinery operations.