Twister Company produces a variety of cleaning compounds and solutions for both industrial and household use. One of its products, a coarse cleaning powder called Grit 337, has a variable manufacturing cost of $1.60 and sells for $2 per pound.
A small portion of this product's annual production is retained for further processing in the Mixing Department, where it is combined with several other ingredients to form a paste that is marketed as a silver polish selling for $4 per jar. The further processing requires one fourth of a pound of Grit 337 per jar; other ingredients, labor, and variable factory overhead associated with further processing cost $2.50 per jar, and unit variable marketing cost is $.30. If a decision is made to cease silver polish production, $5,600 of fixed Mixing Department costs will be avoided.
Required:
Calculate the minimum number of jars of silver polish that must be sold to justify further processing Grit 337.