Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please answer both parts thank you Sell at Split-off or Process Further Decision, Alternatives, Relevant Costs Vhaan Chemicals Company processes a number of chemical compounds
please answer both parts thank you
Sell at Split-off or Process Further Decision, Alternatives, Relevant Costs Vhaan Chemicals Company processes a number of chemical compounds used in disinfecting health club fitness equipment. One compound is decomposed into two chemicals: Mexalene and soreaphine. The cost of processing one batch of compound is $72,500, and the result is 5,500 gallons of exalene and 8,300 gallons of soreaphine. Vihaan Chemicals can sell the nexalent at split off for $11.00 per gallon and the soreaphine for $6,00 per gallon Alternatively, the flexiene can be processed further at a cost of $7.00 per gallon (of hexalene) into tactine. It takes 2 gallons of flexalene for every gallon of lactine. A gallon of lactine sells for $57. Required: 1. Which alternative is more cost effective and by how much? NOTE: DO NOT round interim calculations and, if required, round your answer to the nearest dollar. Process it further 2. What if the production of flexalene into lactine required additional purchasing and quality inspection activity? Every 490 gallons of Mexalene that undergo further processing require 18 more purchase orders at $12 each and 13 more quality inspection hours at $26 each Which alternative would be better and by how much? NOTE: Round interim calculations and your final answer to the nearest cent. Process it further by se Check Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started