Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

help me assap Problem 20-3A (Part Level Submission) Thompson Industrial Products Inc. (TIPI) is a diversified industrial processing company. The company's Dargan plant produces two

help me assapimage text in transcribedimage text in transcribed

Problem 20-3A (Part Level Submission) Thompson Industrial Products Inc. (TIPI) is a diversified industrial 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, 882,000 ounces of chemical input are processed at a cost of $209,100 into 588,000 ounces of floor cleaner and 294,000 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 $240,200. Floor Shine sells at $20 per 30-ounce bottle. The table cleaner can be sold for $17 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 294,000 ounces of another compound (TCP) to the 294,000 ounces of table cleaner. This joint process will yield 294,000 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $101,000. Both table products can be sold for $14 per 25-ounce bottle. The company decided not to process the table cleaner into TsR and TP based on the following analysis. Process Further Table Stain Table Table Remover Cleaner (TSR) Polish (TP) Total Production in ounces 294,000 294,000 294,000 $164,640 $329,280 $199,920 $164,640 Revenues Costs 52,275 104,550 CDG costs 69,700 52,275 TCP costs 50,500 50,500 101,000 Total costs 69,700 102,775 102,775 205,550 Weekly gross profit $130,220 $61,865 $61,865 $123,730 f 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 1,176,000 ounces. TSR and TP combined account for 50% of the total physical output and are each allocated 25% of the CDG cost

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Why And How Of Auditing Auditing Made Easy

Authors: Charles B. Hall

1st Edition

0578519739, 978-0578519739

More Books

Students also viewed these Accounting questions