Question

Kosakowski Corporation processes sugar beets in batches. A batch of sugar beets costs $73 to buy from farmers and $17 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $30 or processed further for $20 to make the end product, industrial fiber that is sold for $50. The beet juice can be sold as is for $49 or processed further for $27 to make the end product, refined sugar that is sold for $98. How much more profit (loss) does the company make by processing one batch of sugar beets into the end products industrial fiber and refined sugar

Answer 1

$11

Step-by-step explanation:

Calculation for how much more profit (loss) that the company make.

Combined final sales value $148

($50+ $98)

Less: costs of producing the end products

Cost of sugar beets ($73)

Cost of crushing ($17)

Combined costs of further processing ($47)

($20+ $27)

Total costs of producing the end products ($137)

Profit (loss) $ 11

($148-$137)

Therefore how much more profit (loss) that the company make by processing one batch of sugar beets into the end products industrial fiber and refined sugar will be $11