Cullumber Industrial Products Inc. is a diversified industrial-cleaner processing company. The company's Dargan plant produces two...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Cullumber Industrial Products Inc. is a diversified industrial-cleaner processing company. The company's Dargan plant produces two products: a table cleaner and a floor cleaner from a common set of chemical inputs (CDG). Each week, 886,500 ounces of chemical input are processed at a cost of $209,100 into 591,000 ounces of floor cleaner and 295,500 ounces of table cleaner. The floor cleaner has no market value until it is converted into a polish with the trade name FloorShine. The additional processing costs for this conversion amount to $252,100. FloorShine sells at $18 per 30-ounce bottle. The table cleaner can be sold for $19 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 295,500 ounces of another compound (TCP) to the 295,500 ounces of table cleaner. This joint process will yield 295,500 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $106,000. Both table products can be sold for $15 per 25-ounce bottle. The company decided not to process the table cleaner into TSR and TP based on the following analysis. Production in ounces Revenues Costs: CDG costs TCP costs Total costs Weekly gross profit Table Cleaner 295,500 $224,580 69,700 0 69,700 $154,880 Table Stain Remover (TSR) 295.500 $177,300 52.275 53,000 105,275 $72,025 Process Further Table Polish (TP) 295,500 $177,300 52,275 53,000 105,275 $72.025 Total $354,600 104,550 106,000 210 550 $144,050 "If table cleaner is not processed further, it is allocated 1/3 of the $209,100 of CDG cost, which is equal to 1/3 of the total physical output. **if table cleaner is processed further, total physical output is 1,182.000 ounces. TSR and TP combined account for 50% of the total physical output and are each allocated 25% of the CDG cost. Determine if management made the correct decision to not process the table cleaner further by doing the following (1) Calculate the company's total weekly gross profit assuming the table cleaner is not processed further. Total weekly gross profit $ (2) Calculate the company's total weekly gross profit assuming the table cleaner is processed further. Total weekly gross profit $ Pasion (3) Compare the resulting net incomes and comment on management's decision. Management made the Flight wrong decision by choosing to not process table cleaner further. Cullumber Industrial Products Inc. is a diversified industrial-cleaner processing company. The company's Dargan plant produces two products: a table cleaner and a floor cleaner from a common set of chemical inputs (CDG). Each week, 886,500 ounces of chemical input are processed at a cost of $209,100 into 591,000 ounces of floor cleaner and 295,500 ounces of table cleaner. The floor cleaner has no market value until it is converted into a polish with the trade name FloorShine. The additional processing costs for this conversion amount to $252,100. FloorShine sells at $18 per 30-ounce bottle. The table cleaner can be sold for $19 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 295,500 ounces of another compound (TCP) to the 295,500 ounces of table cleaner. This joint process will yield 295,500 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $106,000. Both table products can be sold for $15 per 25-ounce bottle. The company decided not to process the table cleaner into TSR and TP based on the following analysis. Production in ounces Revenues Costs: CDG costs TCP costs Total costs Weekly gross profit Table Cleaner 295,500 $224,580 69,700 0 69,700 $154,880 Table Stain Remover (TSR) 295.500 $177,300 52.275 53,000 105,275 $72,025 Process Further Table Polish (TP) 295,500 $177,300 52,275 53,000 105,275 $72.025 Total $354,600 104,550 106,000 210 550 $144,050 "If table cleaner is not processed further, it is allocated 1/3 of the $209,100 of CDG cost, which is equal to 1/3 of the total physical output. **if table cleaner is processed further, total physical output is 1,182.000 ounces. TSR and TP combined account for 50% of the total physical output and are each allocated 25% of the CDG cost. Determine if management made the correct decision to not process the table cleaner further by doing the following (1) Calculate the company's total weekly gross profit assuming the table cleaner is not processed further. Total weekly gross profit $ (2) Calculate the company's total weekly gross profit assuming the table cleaner is processed further. Total weekly gross profit $ Pasion (3) Compare the resulting net incomes and comment on management's decision. Management made the Flight wrong decision by choosing to not process table cleaner further.
Expert Answer:
Answer rating: 100% (QA)
The detailed answer for the above question is provided below Answer Solution Q1 Calculate the compan... View the full answer
Related Book For
Managerial Accounting Tools for Business Decision Making
ISBN: 978-1119036432
7th edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Posted Date:
Students also viewed these accounting questions
-
Style Inc. is a hair care studio that specializes in haircuts and entertainment. During a haircut, the customer receives a beverage of their choosing and watches television or chooses to listen to...
-
Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company. The company's Dargan plant produces two products: a table cleaner and a floor cleaner from a common...
-
Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company. The company's Dargan plant produces two products: a table cleaner and a floor cleaner from a common...
-
Consider two industries in which firms hold the following market shares: Industry A: 25%, 20%, 18%, 15%, 8%, 7%, 4%, 2%, 1% Industry B: 30%, 10%, 9%, 8%, 8%, 8%, 8%, 6%, 6%, 5%, 2% What are the...
-
Suppose that the strength of the electric field about an isolated point charge has a certain value at a distance of 1 m. How will the electric field strength compare at a distance of 2 m from the...
-
At its headquarters in Ventura, California, Patagonia's office space feels more like a national park lodge than the main office of a $400 million retailer. It has a Douglas fir staircase and a...
-
The following information from Jefferson Company's operations is available: Required a. Prepare a multiple-step income statement. Disregard earnings per share amounts. b. Prepare a single-step income...
-
The bookkeeper for Geronimo Company has prepared the following balance sheet as of July 31, 2008. The following additional information is provided. 1. Cash includes $1,200 in a petty cash fund and...
-
Scenario 1 2 . 3 Tom Bergman, owner and operator of the Earplug Superstore, is reviewing the costs associated with the store's best - selling hearing aid, the BZ 1 5 . The data available to Mr ....
-
Jill Beaver was an employee at RGIS Inventory Specialists. She became ill while on vacation with acute sinusitis, bronchitis, and an ear infection. She was prescribed an antibiotic by a physician,...
-
The body tries to protect itself from ethanol alcohol intake and the damages of alcohol in a variety of ways. All of the following are correct except: a. Too much alcohol too fast will trigger the...
-
Identify the hazards you see in this picture ensure that you are being specific about the hazards Describe the hazard and why you think its a hazard Identify what type of hazard it is ( people,...
-
A 10-year annuity-immediate with annual payments of 1000 is selling at 7537.63. If the required rate of return for Lucy is 6%, should she invest on this annuity or not
-
5. Find the total differential given: f(x, y) = 4x - y 5x + 4y x = 0, y = 1, dx = 0.01, dy = 0.03 Page 6 of 8
-
Question 7 V A Given f(x, y) = 2x + 3y 6x+2y find f(x, y) = fy(x, y) = > Next Question
-
Bearings & Brakes Corporation (B&B) was incorporated as a private company. The company's accounts included the following at June 30: Accounts Payable Buildings Cash Common Stock Equipment Land Notes...
-
Ram Roy's firm has developed the following supply. demand, cost, and inventory data. Allocate production capac- ity to meet demand at a minimum cost using the transportation method. What is the cost?...
-
For a Poisson process of rate , the Bernoulli arrival approximation assumes that in any very small interval of length , there is either 0 arrivals with probability 1- or 1 arrival with probability ....
-
Markowis Corp. has collected the following data concerning its maintenance costs for the past 6 months. Compute the variable- and fixed-cost elements using the high-low method. July August September...
-
Determine the missing amounts. Unit Selling Unit Variable Costs Unit Contribution Margin Contribution Margin Ratio Price 1. $640 2. S300 3. (e) S352 $93 $325 25%
-
Presented below are data relating to labor for Verde Appliance Repair Shop. Repair-technicians' wages ................ $110,000 Fringe benefits .............................. 40,000 Overhead...
-
_________ taxes are designed to take a larger percentage of high incomes as compared to lower incomes. a. Progressive b. Regressive c. Proportional d. Negative
-
Who must legally pay Social Security and Medicare taxes? a. Employers b. Employees c. Both employers and employees d. Neither employers nor employees
-
Expenditures on _________ comprise the largest component of state and local government budgets. a. education b. public safety c. public infrastructure (such as roads and water works) d. public...
Study smarter with the SolutionInn App