Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sell at Splie-off or Process Further Decision, Alternatives, Relevant Costs Vihaan Chemicals Company processes a number of chemical compounds used in disinfecting health club fitness

image text in transcribed
image text in transcribed
Sell at Splie-off or Process Further Decision, Alternatives, Relevant Costs Vihaan Chemicals Company processes a number of chemical compounds used in disinfecting health club fitness equipment. One compound is decomposed into two Chemicals: flexalene and soreachine. The cost of processing one batch of compound is 873,000, and the result is 5,700 gallons of flexalene and 7,500 gallons of soreaphine. Vihaan Chemicals can sell the flexalene at spin-off for $12.00 per cation and the soreaphine for $7.45 per gallon. Alternatively , the flexoiene can be processed further at a cost of $5.70 per gation of flexalene) into tactine. It takes 2 pallons of fexalene for every gallon of actine. A gallion of latine sells for $63. 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 by 2. What if the production of flexslene into lactine required additional purchasing and quality inspection activity? Every 600 gations of flexalene that undergo further processing require 20 more purchase orders at $11 each and 12 more quality inspection hours at 524 each. Which alternative would be better and by how much! NOTE: Round interim calculations and your final answer to the nearest cent. by

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

Survey Of Accounting

Authors: Carl S. Warren, Amanda Farmer

9th Edition

0357132599, 978-0357132593

More Books

Students also viewed these Accounting questions

Question

Explain how to handle conflict effectively.

Answered: 1 week ago

Question

Always have the dignity of the other or others as a backdrop.

Answered: 1 week ago