OrganicPlus processes organic milk into plain yogurt OrganicPlus sells plain yogurt to hospitals, nursing homes,...

50.1K

Verified Solution

Question

Accounting

image
image
OrganicPlus processes organic milk into plain yogurt OrganicPlus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers Each batch, processed at a cost of $830, yields 750 gallons of plain yogurt OrganicPlus sells the one-gallon tubs for $8 00 each and spends $0 10 for each plastic tub. Management has recently begun to reconsider its strategy. OrganicPlus wonders if it would be more profitable to sell individual-sized portions of fruited organic yogurt at local food stores. OrganicPlus could further process each batch of plain yogurt into 16,000 individual portions (3/4 cup each) of fruited yogurt A recent market analysis indicates that demand for the product exists. OrganicPlus would sell each individual portion for $0 40 Packaging would cost $0.07 per portion, and fruit would cost $0.12 per portion. Fixed costs would not change. Should OrganicPlus continue to sell only the gallon-sized plain yogurt (sell as is) or convert the plan yogurt into individual-sized portions of fruited yogurt (process further)? Why? Calculate the net benefit per batch under each alternative. (Enter a "0" for any zero amounts. Round the net benefit per batch to the nearest whole dollar) Less Based on this analysis, it is more profitable to sell

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students