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    "question_id": "4282500",
    "url": "\/study-help\/questions\/thompson-industrial-products-inc-tipi-is-a-diversified-industrialcleaner-processing-4282500",
    "question_creation_date_js": "2024-06-28T09:21:55-04:00",
    "question_creation_date": "Jun 28, 2024 09:21 AM",
    "meta_title": "[Solved] Thompson Industrial Products Inc. (TIPI) | SolutionInn",
    "meta_description": "Answer of - Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company. The company's Dargan | SolutionInn",
    "meta_keywords": "thompson,industrial,products,inc,tipi,diversified,industrial-cleaner,processing,company,s,dargan,plant",
    "question_title_h1": "Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company. The company's Dargan plant produces two products: a table cleaner and a floor cleaner",
    "question_title": "Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company. The",
    "question_title_for_js_snippet": "Thompson Industrial Products Inc  (TIPI) is a diversified industrial cleaner 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, 927,000 ounces of chemical input are processed at a cost of $212,100 into 618,000 ounces of floor cleaner and 309,000 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 $245,000  FloorShine sells at $18 per 30 ounce bottle  The table cleaner can be sold for $18 per 25 ounce bottle  However, the table cleaner can be converted into two other products by adding 309,000 ounces of another compound (TCP) to the 309,000 ounces of table cleaner  This joint process will yield 309,000 ounces each of table stain remover (TSR) and table polish (TP)  The additional processing costs for this process amount to $109,000  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 TableCleaner Table StainRemover (TSR) TablePolish (TP) Total Production in ounces 309,000 309,000 309,000 Revenues $222,480 $173,040 $173,040 $346,080 Costs  CDG costs 70,700   53,025 53,025 106,050   TCP costs 0 54,500 54,500 109,000 Total costs 70,700 107,525 107,525 215,050 Weekly gross profit $151,780 $65,515 $65,515 $131,030  If table cleaner is not processed further, it is allocated 1 3 of the $212,100 of CDG cost, which is equal to 1 3 of the total physical output    If table cleaner is processed further, total physical output is 1,236,000 ounces  TSR and TP combined account for 50  of the total physical output and are each allocated 25  of the CDG cost  Determine if management made the correct decision to not process the table cleaner further by doing the following  (1) Calculate the company's total weekly gross profit assuming the table cleaner is not processed further  Total weekly gross profit$ (2) Calculate the company's total weekly gross profit assuming the table cleaner is processed further  Total weekly gross profit$ (3) Compare the resulting net incomes and comment on management's decision  Management made thewrongright decision by choosing to not process table cleaner further ",
    "question_description": "<p><span>Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner 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, 927,000 ounces of chemical input are processed at a cost of $212,100 into 618,000 ounces of floor cleaner and 309,000 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 $245,000.<\/span><\/p> <p> <\/p> <p><span>FloorShine sells at $18 per 30-ounce bottle. The table cleaner can be sold for $18 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 309,000 ounces of another compound (TCP) to the 309,000 ounces of table cleaner. This joint process will yield 309,000 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $109,000. Both table products can be sold for $14 per 25-ounce bottle.<\/span><\/p> <p> <\/p> <p><span>The company decided not to process the table cleaner into TSR and TP based on the following analysis.<\/span><\/p> <p> <\/p> <p> <strong>Process Further<\/strong><\/p> <p> <strong>TableCleaner<\/strong> <strong>Table StainRemover (TSR)<\/strong> <strong>TablePolish (TP)<\/strong> <strong>Total<\/strong><\/p> <p>Production in ounces 309,000 309,000 309,000<\/p> <p>Revenues $222,480 $173,040 $173,040 $346,080<\/p> <p>Costs:<\/p> <p>CDG costs 70,700<sup>*<\/sup> 53,025 53,025 106,050**<\/p> <p>TCP costs 0 54,500 54,500 109,000<\/p> <p>Total costs 70,700 107,525 107,525 215,050<\/p> <p>Weekly gross profit $151,780 $65,515 $65,515 $131,030<\/p> <p> <\/p> <p><span>*If table cleaner is not processed further, it is allocated 1\/3 of the $212,100 of CDG cost, which is equal to 1\/3 of the total physical output.<\/span><\/p> <p><span>**If table cleaner is processed further, total physical output is 1,236,000 ounces. TSR and TP combined account for 50% of the total physical output and are each allocated 25% of the CDG cost.<\/span><\/p> <p> <\/p> <p><span>Determine if management made the correct decision to not process the table cleaner further by doing the following.<\/span><\/p> <p> <\/p> <p><span>(1) Calculate the company's total weekly gross profit assuming the table cleaner is not processed further.<\/span><\/p> <p> <\/p> <p>Total weekly gross profit$<\/p> <p> <\/p> <p><span>(2) Calculate the company's total weekly gross profit assuming the table cleaner is processed further.<\/span><\/p> <p> <\/p> <p>Total weekly gross profit$<\/p> <p> <\/p> <p><span>(3) Compare the resulting net incomes and comment on management's decision.<\/span><\/p> <p> <\/p> <p>Management made thewrongright<\/p> <p>decision by choosing to not process table cleaner further.<\/p>",
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