III Homework: chapter 6 homework 6 Question 1, P6-63 (book. Part 1 of 4 HW See O Poin Agribiz Food Products produces a wide variety of food and related products. The company's tomato-canning operation relles partly on tomatoes grown on Agribe's own farms and partly on tomatoes bought from other growers. Agrible's tomato farm is on the edge of Sharpestown a fast-growing, medium-sized city. It produces 8 million pounds of tomatoes a year and employs 65 persons. The annual costs of tomatoes grown on this form are as follows: (Click the icon to view the data) Fixed production costs include depr depreciated. Agribiz owns the land, land at $18 million because it is a pr needs on the market for $0 25 perp operations in Sharpestown. If the fa cash and earn an annual rate of 10 Read the requirements Requirement 1. How much does it cost Agribiz annually for the land used by the tomato farm? It costs Agribi $ annually for the land used by the tomato farm. This is the cost for the land Valery Ochoa 1, P6-63 (book... Part 1 of 4 HW Score: 0%, 0 of 1 point O Points: 0 of 1 Save artly edge The Fixed production costs include depreciation on machinery and equipment, but not on land because land should not be depreciated. Agribiz owns the land, which was purchased for $600,000 many years ago A recent appraisal placed the value of the land at $18 million because it is a prime site for an industrial park and shopping center Agribic could purchase all the tomatoes it needs on the market for $0.25 per pound delivered to its factory If it did this, it would sell the farmland and shut down the operations in Sharpestown. If the farm were sold, 5300,000 of the annual fixed costs would be saved. Agribiz can invest excess cash and earn an annual rate of 10% Read the requirements 7 ed products. The company's tomato-canning operation relles partly es bought from other growers Agribiz's tomato farm is on the edge B million pounds of tomatoes a year and employs 55 persons. The Fixed production costs include depreciation on machinery and equipment, but not on tane depreciated. Agribiz owns the land, which was purchased for $600.000 many years ago land at $18 million because it is a prime site for an industrial park and shopping center. A noode on the market.fo 26. noun dalamados factory If it did this, it would sell 000 of the annual fixed costs wou Requirements land used 1. How much does it cost Agribiz annually for the land used by the tomato farm? 2. How much would Agribiz save annually if it closed the tomato farm? Is this more or less than would be paid to purchase the tomatoes on the market? 3. What ethical issues are involved with the decision to shut down the tomato farm? mm. This is the Print Done
