Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please fill in the blanks below and answer the following from the information: In order to maximize profits Dairymaid should choose the alternative that results
Please fill in the blanks below and answer the following from the information:
In order to maximize profits Dairymaid should choose the alternative that results in the most net benefit per batch. Based on your analysis above, does this mean that the company should sell the gallon-size plain yogurt (sell as is), or convert the plain yogurt into individual-size portions of fruited yogurt (process further)? Dairyplus processes organic milk into plain yogurt. i (Click the icon to view additional information.) Should Dairyplus continue to sell only the gallon-size plain yogurt (sell as is) or convert the plain yogurt into individual-size portions of fruited yogurt (process further)? Why? (Use a minus sign or parentheses for amounts that are typically shown enclosed in parentheses in a sell or process further decision.) Costs Expected revenue from selling by the gallon Expected revenue from selling individual portions Additional costs of selling as is by the gallon Additional costs of processing individual portions Total net revenue More info Sell As Is Print Process Further Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $840, yields 1,050 gallons of plain yogurt. Dairyplus sells the one-gallon tubs for $10 each, and spends $0.22 for each plastic tub. Dairyplus has recently begun to reconsider its strategy. Dairyplus wonders if it would be more profitable to sell individual-size portions of fruited organic yogurt at local food stores. Dairyplus could further portion process each batch of plain yogurt into 22,400 individual portions (3/4 cup each) of fruited yogurt. A recent market analysis indicates that demand for the product exists. Dairyplus would sell each individual portion for $0.54. Packaging would cost $0.06 per portion, and fruit would cost $0.12 per portion. Fixed costs would not change. Done Difference X CStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started