(Solved): Q-7) Company X process materials extracted from mines. The most common raw material that it processe ...

Q-7) Company X process materials extracted from mines. The most common raw material that it processes results in three joint products; Product A, Product B and Product C. Each of these products can be sold as is, or each can be processed further and sold for a higher price. The company incurs joint costs of TL180,000 to process one batch of the raw material that produces the three joint products. These joint costs are allocated to the products based on the tonnage of output, following a 60:30:10 ratio based on historical yield. Additionally, the company records TL51,000 in depreciation on mining equipment for each batch. due to inflationary pressure, raw material and further processing costs may rise by 3% in the upcoming year. The following cost and sales information is available for one batch of each product: Determine total net income after deciding which products should be sold at the split-off point and which should be processed further using incremental analysis. Q-8) Company X has an existing machine which is straight line depreciated to process its invoices. Following information pertains to this machine. The company is considering replacing this machine with a new one. New machine will cost TL140,000 and will have 3 years useful life. It also qualifies for a 40% accelerated depreciation allowance over its first year. Per annum operating costs of the new machine are TL80,090. Determine if the company should retain or replace the existing machine ignoring the time value of money. Note enter 1 if the machine is retained, enter 2 if the machine is replaced.