Dairyplus processes organic milk into plain yogurt. Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $800, yields 570 gallons of plain yogurt. The company sells the one-gallon tubs for $8.00 each and spends $0.16 for each plastic tub. Dairyplus has recently begun to reconsider its strategy Management wonders if it would be more profitable to set individual-sized portions of fruited organic yogurt at local food stores. Dairyplus could further process each batch of plain yogurt into 12.160 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 $0.50. Packaging would cost $0.05 per portion, and fruit would cost $0.11 per portion Fixed costs would not change. Should Dairyplus continue to sell only the gallon-sized plain yogurt (sell as is) or convert the plain yogurt into individual-sized portions of fruited yogurt (process further)? Why? Calculate the net benefit per batch under each alternative. (Enter a "0" for any zero amounts. Round the net benefit per batch to the nearest whole dollar) Sell as gallon-size Sell as individual containers portions Less: Net benefit per unit Not benefit per batch
Dairyplus processes organic milk into plain yogurt. Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $800, yields 570 gallons of plain yogurt. The company sells the one-gallon tubs for $8.00 each and spends $0.16 for each plastic tub. Dairyplus has recently begun to reconsider its strategy Management wonders if it would be more profitable to set individual-sized portions of fruited organic yogurt at local food stores. Dairyplus could further process each batch of plain yogurt into 12.160 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 $0.50. Packaging would cost $0.05 per portion, and fruit would cost $0.11 per portion Fixed costs would not change. Should Dairyplus continue to sell only the gallon-sized plain yogurt (sell as is) or convert the plain yogurt into individual-sized portions of fruited yogurt (process further)? Why? Calculate the net benefit per batch under each alternative. (Enter a "0" for any zero amounts. Round the net benefit per batch to the nearest whole dollar) Sell as gallon-size Sell as individual containers portions Less: Net benefit per unit Not benefit per batch
Chapter1: Financial Statements And Business Decisions
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Problem 1Q
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Transcribed Image Text:Dairyplus processes organic milk into plain yogurt. Dairyplus sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $800,
yields 570 gallons of plain yogurt. The company sells the one-gallon tubo for $8.00 each and spends $0.16 for each plastic tub. Dairyplus has recently begun to reconsider its strategy Management
wonders if it would be more profitable to sell individual-sized portions of fruited organic yogurt at local food stores. Dairyplus could further process each batch of plain yogurt into 12.160 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 $0.50. Packaging would cost $0.05
per portion, and fruit would cost $0.11 per portion Fixed costs would not change. Should Dairyplus continue to sell only the gallon-sized plain yogurt (sell as is) or convert the plain yogurt
into individual-sized portions of fruited yogurt (process further)? Why?
Calculate the net benefit per batch under each alternative. (Enter a "0" for any zero amounts. Round the net benefit per batch to the nearest whole dollar)
Sell as gallon-size Sell as individual
containers
portions
Less
Net benefit per unit
Net benefit per batch
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