Question
Resendes Refiners, Inc., processes sugar cane that it purchases from farmers. Sugar cane is processed in batches. A batch of sugar cane costs $50 to
Resendes Refiners, Inc., processes sugar cane that it purchases from farmers. Sugar cane is processed in batches. A batch of sugar cane costs $50 to buy from farmers and $18 to crush in the company's plant. Two intermediate products, cane fiber and cane juice, emerge from the crushing process. The cane fiber can be sold as is for $27.00 or processed further for $18.50 to make the end product industrial fiber that is sold for $39.50. The cane juice can be sold as is for $35.60 or processed further for $24.92 to make the end product molasses that is sold for $80. How much profit (loss) does the company make by processing the intermediate product cane juice into molasses rather than selling it as is?
$(1.48) | |
$19.48 | |
$48.52 | |
$(13.42) |
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