8. 6.00 points value: Sohr Corporation processes sugar beets that it purchases f

Question

8. 6.00 points value: Sohr Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $64 to buy from farmers and $23 to crush in the company's plant. Two intermediate products, beet fiber and beet juice, emerge from the crushing process. The beet fiber can be sold as is for $34 or processed further for $37 to make the end product industrial flber that is sold for $85. The beet juice can be sold as is for $55 or processed further for $41 to make the end product refined sugar that is sold for $85. How much more profit (loss) does the company make by processing one batch of sugar beets into the end products industrial flber and refined sugar? O $(165) o $(4) O $5 $21

Explanation / Answer

Profit / (Loss) from End Product

= Sale Price of Industrial Fiber + Sale Price of Refind Sugar - Suger Beets Buying cost from Buyer - Crushing Process Cost - Further Process cost of Beet Fiber to Make Industrial Fiber - Further Process Cost of Beet Juice to make Refind Sugar

= $ 85 + $ 85 - $ 64 - $ 23 - $ 37 - $ 41

= $ 5 is the Profit form Further Processing

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