A7 Zytel Corporation produces cleaning compounds and solutions for industrial and household use. While most of its products areprocessed independently, a few are related. Grit 337, a coarse cleaning powder with many industrial uses, costs $1.60 a pound tomake and sells for $2.80 a pound. A small portion of the annual production of this product is retained for further processing in theMixing Department, where it is combined with several other ingredients to form a paste, which is marketed as a silver polish selling for$5.20 per jar. This further processing requires 1/4 pound of Grit 337 per jar. Costs of other ingredients, labor, and variable overheadassociated with this further processing amount to $2.20 per jar. Variable selling costs are $0.30 per jar. If the decision were made tocease production of the silver polish, $8,200 of Mixing Department fixed costs could be avoided. Zytel has limited production capacityfor Grit 337, but unlimited demand for the cleaning powder.Required:Calculate the minimum number of jars of silver polish that would have to be sold to justify further processing of Grit 337. (Round yourintermediate calculations to 2 decimal places and final answer to the nearest whole number.)Minimum number of jars

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Zytel Corporation produces cleaning compounds and solutions for industrial and household use. While most of its products are processed independently, a few are related. Grit 337, a coarse cleaning powderwith many industrial uses, costs $1.60 a pound to make and sells for $2.00 a pound. A small portion of the annual production of this product is retained for further processing in the Mixing Department, where it is combined with several other ingredients to form a paste, which is marketed as a silver polish selling for $4.00 per jar. This further processing requires ¼ pound of Grit 337 per jar. Costs of other ingredients, labor, and variable overhead associated with this further processing amount to $2.50 per jar. Variableselling costs are $.30 per jar. If the decision were made to cease production of the silver polish, $5,600 of Mixing Department fixed costs could be avoided. Zytel has limited production capacity for Grit 337, but unlimited demand for the cleaning powder. Required:…
Cantel Company produces cleaning compounds for both commercial and household customers. Some of these products are produced as part of a joint manufacturing process. For example, GR37, a coarse cleaning powder meant for commercial sale, costs $1.80 a pound to make and sells for $2.00 per pound. A portion of the annual production of GR37 is retained for further processing in a separate department where it is combined with several other ingredients to form SilPol, which is sold as a silver polish, at $5.00 per unit. The additional processing requires 1/5 pound of GR37 per unit; additional processing costs amount to $3.70 per unit of SilPol produced. Variable selling costs for SilPol average $0.20 per unit. If production of SilPol were discontinued, $4,900 of costs in the processing department would be avoided. Cantel has, at this point, unlimited demand for, but limited capacity to produce, product GR37. 2. Assume that the cost data reported for GR37 are obtained at a level of output…
Cantel Company produces cleaning compounds for both commercial and household customers. Some of these products are produced as part of a joint manufacturing process. For example, GR37, a coarse cleaning powder meant for commercial sale, costs $2.30 a pound to make and sells for $2.40 per pound. A portion of the annual production of GR37 is retained for further processing in a separate department where it is combined with several other ingredients to form SilPol, which is sold as a silver polish, at $6.00 per unit. The additional processing requires 1/4 pound of GR37 per unit; additional processing costs amount to $4.20 per unit of SilPol produced. Variable selling costs for SilPol average $0.60 per unit. If production of SilPol were discontinued, $7,200 of costs in the processing department would be avoided. Cantel has, at this point, unlimited demand for, but limited capacity to produce, product GR37. 1. Calculate the minimum number of units of SilPol that would have to be sold in…
Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company’s Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a pound to make, and it has a selling price of $6.40 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $5.00 per jar. This further processing requires one-fourth pound of Grit 337 per jar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients $ 0.60 Direct labor 1.48 Total direct cost $ 2.08 Overhead costs associated with processing the silver polish are:…
Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company's Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a pound to make, and it has a selling price of $2.00 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $4.00 per jar. This further processing requires one-fourth pound of Grit 337 per jar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients Direct labor $ 0.65 1.48 $ 2.13 Total direct cost Overhead costs associated with processing the silver polish are: Variable manufacturing overhead cost…
Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company's Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $5.40 a pound to make, and it has a selling price of $9.60 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $4.00 per jar. This further processing requires one-fourth pound of Grit 337 per jar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients Direct labor Total direct cost $ -0.11 0.72 $ .61 Overhead costs associated with processing the silver polish are: Variable manufacturing overhead cost…
Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company’s Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a pound to make, and it has a selling price of $6.80 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $5.00 per jar. This further processing requires one-fourth pound of Grit 337 per jar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients $ 0.65 Direct labor 1.36 Total direct cost $ 2.01 Overhead costs associated with processing the silver polish are: Variable…
Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household use. While most of its products are processed independently, a few are related, such as the company’s Grit 337 and its Sparkle silver polish. Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a pound to make, and it has a selling price of $6.40 a pound. A small portion of the annual production of Grit 337 is retained in the factory for further processing. It is combined with several other ingredients to form a paste that is marketed as Sparkle silver polish. The silver polish sells for $5.00 per jar. This further processing requires one-fourth pound of Grit 337 per jar of silver polish. The additional direct variable costs involved in the processing of a jar of silver polish are: Other ingredients $ 0.60 Direct labor 1.48 Total direct cost $ 2.08 Overhead costs associated with processing the silver polish are:…
Come-Clean Corporation produces a variety of cleaning compounds and solutions forboth industrial and household use. While most of its products are processedindependently, a few are related, such as the company’s Grit 337 and its Sparkle silverpolish.Grit 337 is a coarse cleaning powder with many industrial uses. It costs $1.60 a poundto make, and it has a selling price of $6.80 a pound. A small portion of the annualproduction of Grit 337 is retained in the factory for further processing. It is combinedwith several other ingredients to form a paste that is marketed as Sparkle silver polish.The silver polish sells for $5.00 per jar.This further processing requires one-fourth pound of Grit 337 per jar of silver polish. Theadditional direct variable costs involved in the processing of a jar of silver polish are:Other ingredients $ 0.60Direct labor 1.40Total direct cost $ 2.00Overhead costs associated with processing the silver polish are:Variable manufacturing overhead cost 25 % of direct…
Carla Vista Industrial Products Inc. 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, 931,500 ounces of chemical input are processed at a cost of $207,300 into 621,000 ounces of floor cleaner and 310,500 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 $257,400.FloorShine sells at $20 per 30-ounce bottle. The table cleaner can be sold for $21 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 310,500 ounces of another compound (TCP) to the 310,500 ounces of table cleaner. This joint process will yield 310,500 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $106,000. Both table…
Carla Vista Industrial Products Inc. 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, 931,500 ounces of chemical input are processed at a cost of $207,300 into 621,000 ounces of floor cleaner and 310,500 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 $257,400.FloorShine sells at $20 per 30-ounce bottle. The table cleaner can be sold for $21 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 310,500 ounces of another compound (TCP) to the 310,500 ounces of table cleaner. This joint process will yield 310,500 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $106,000. Both table…
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, 900,000 ounces of chemical input are processed at a cost of $210,000 into 600,000 ounces of floor cleaner and 300,000 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 $240,000.FloorShine sells at $20 per 30-ounce bottle. The table cleaner can be sold for $17 per 25-ounce bottle. However, the table cleaner can be converted into two other products by adding 300,000 ounces of another compound (TCP) to the 300,000 ounces of table cleaner. This joint process will yield 300,000 ounces each of table stain remover (TSR) and table polish (TP). The additional processing costs for this process amount to $100,000. Both…

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