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Mariachi Industrial Products Co. is a diversified industrial-cleaner processing company. the company s main plant produces two products: a table cleaner and a floor cleaner.

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Mariachi Industrial Products Co. is a diversified industrial-cleaner processing company. the company s main plant produces two products: a table cleaner and a floor cleaner. They are made from a common set of chemical inputs (called CDG). Each week, the company processes 28, 350 liters of chemical input at a cost of $208, 200 into 18, 900 liters of floor cleaner and 9, 450 liters of table cleaner. the floor cleaner has no market value until it is converted into a polish with the trade name Floor Shine. the additional processing costs for this conversion total $254,000. Floor Shine sells at $15 per one-liter bottle. the table cleaner can be sold for $25 per one-liter bottle. However, the table cleaner can be converted into two other products by adding 9, 450 liters of another compound (TCP) to the 9, 450 liters of table cleaner. This joint process will yield 9, 450 liters each of table stain remover and table polish. the additional processing costs for this process are $120,000. Both table products can be sold for $21 per one-liter bottle. the company decided not to process the table cleaner into table stain remover and table polish based on the following analysis: If the table cleaner is not processed further, it is allocated one third of the $208, 200 of CDG cost, which is equal to one third of the total physical output. If the table cleaner is processed further, the total physical output is 37, 800 liters. Table stain remover and table polish combined account for 50% of the total physical output and are each allocated 25% of the CDG cost. Do the following to determine whether management made the correct decision by not processing the table cleaner further. Calculate the company's total weekly gross profit assuming the table cleaner is not processed further. Company's total weekly gross profit $ Calculate the company's total weekly gross profit assuming the table cleaner is processed further. Company's total weekly gross profit $ Compare the resulting net incomes and comment on management's decision. Management made the decision by choosing to not process table cleaner further. Using incremental analysis, determine if the table cleaner should be processed further. (If an amount reduces the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).) the table cleaner be processed further

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