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its not 199100 and 208900 Sandhill Industrial Products Inc. (S|Pl) is a divarsifed industrial-sleaner processing compary. The company's Dargan plant produces two products: a table
its not 199100 and 208900
Sandhill Industrial Products Inc. (S|Pl) is a divarsifed industrial-sleaner processing compary. The company's Dargan plant produces two products: a table cleaner and a floor cleaner from a common set of chemical inputs (CDG]. Each wesk, 991,000 ounces of chemical input are processed at a cost of $212,400 into 594,000 ounces of floor cleaner and 297,000 ounces of table claner. The floor claanar has no marlat value until it is converted into a polish with the tradename FloorShine. The additional processing costs for this comversion amount to $241,800 FloorShine sells at $21 per 30 -ounce bottle. The table cleaner can be sold for $20 per 25 -ounce bottle. However, the table cleaner can be conwerted into two ather products by addinz 297,000 ounces of another corpound (TCP) to the 297,000 ounces af table cleaner. This joint process will yiald 297,000 ounces each of table stain remover (TSR) and table polish [TP]. The additional procassinz costs for this process amount to $109,000. Path table products can be sald for $15 per 25 -ounce bottle. The company decided not to process the table claanarinto TSR and TP based on the followinz analysis. "If table cleaner is not processed further, it is allocated 1/3 of the $212,400 of CDG coat, which is egual to 1/3 of the total physical output *"If table claner is processed further, tatal physical output is 1,199,000 ounces. TSR and TP combined account for 505 of the total physical output and are anch allocated 25% of the CDG cost (a) Determine if management made the correct decision to not process the table cleaner further by daing the followinz (1) Calculate the company's total wakkly aross profit assuming the table cleaner is nat processed further. Total vesikly aress profit (2) Calculate the company's total wakkly gross profit assuming the table cleaner is processed further. Totil veskikly aross profit 3 (3) Compare the resulting net incomes and comment on managament's decision. Managemant made the decision by choosing to not process table claener furtherStep by Step Solution
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