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Fresh Farms, Inc. grows basil at a total cost of $66,000. The production generates 60,000 bunches of basil which can be sold for $2 per
Fresh Farms, Inc. grows basil at a total cost of $66,000. The production generates 60,000 bunches of basil which can be sold for $2 per bunch to a spice company, or the basil can be further processed inhouse into pesto and then sold for $3.25 per jar. It costs $55,000 more to turn the basil into pesto. If Fresh Farms processes the basil into pesto, how much is the incremental profit or loss? What should Fresh Farms do?
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