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1. Ecker, Inc. produces milk at a total cost of $66,000. The production generates 60,000 gallons of milk which can be sold for $1
1. Ecker, Inc. produces milk at a total cost of $66,000. The production generates 60,000 gallons of milk which can be sold for $1 per gallon to a pasteurization company, or the milk can be processed further into ice cream and then sold for $3 per gallon. It costs $75,000 more to turn the annual milk supply into ice cream. Instructions If Ecker processes the milk into ice cream, how much is the incremental profit or loss? Should Ecker process the milk into ice cream or sell it as is? Show your work. Gary King, Waterway & King Fabricators' production manager, has just received the company's sales budget for the first quarter. Budgeted units sold January February March Quarter 20,000 30,000 32,000 82,000 $16 $16 $16 $16 Budgeted sales price Budgeted revenue $320,000 $480,000 $512,000 $1,312,000 Budgeted sales of April is 34,000. Company policy requires an ending finished goods inventory each month that will meet 20% of the following month's sales volume. Gary plans to have 2.200 finished bricks at a cost of $49,280 in inventory at the beginning of the year. Prepare Waterway & King's production budget for the first quarter. January March Quarter February
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