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The Dairy Division of Waterway Industries produces and sells milk to outside customers. The operation has the capacity to produce 200000 gallons of milk a
The Dairy Division of Waterway Industries produces and sells milk to outside customers. The operation has the capacity to produce 200000 gallons of milk a year. Last years operating results were as follows: Sales (170000) gallons $986000 Variable costs 289000 Contribution margin 697000 Fixed costs 187000 Net Income $ 510000 Assume the Yogurt Division wants to purchase 20000 gallons of milk from the Dairy Division. The minimum price that will increase the Dairy Divisions profit is
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