Determine if product should be sold or processed further.
Thompson Industrial Products Inc. (TIPI) is a diversified industrial-cleaner processing company.
produces two products: a table cleaner and a floor cleaner from a common set of chemical input
ounces of chemical input are processed at a cost of $210,000 into 600,000 ounces of floor clean
The floor cleaner has no market value until it is converted into a polish with the trade na
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-ou
cleaner can be converted into two other products by adding 300,000 ounces of another compou
of table cleaner. This joint process will yield 300,000 ounces each
of table stain remover (TSR)
additional processing costs for this process amounts to $100,000.
Both table products can be s
The company decided not to process the table cleaner into TSR and TP based on the followin
Production in ounces