35 Maxim manufactures a cat food product called Green Health. Maxim currently has 10,000 bags of Green Health on hand. The variable production costs per bag are $3.30 and total fixed costs are $10,000. The cat food can be sold as it is for $8.65 per bag or be processed further into Premium Green and Green Deluxe at an additional $2,500 cost. The additional processing will yield 10,000 bags of Premium Green and 3,500 bags of Green Deluxe, which can be sold for $7.65 and $5.65 per bag, respectively. If Green Health is processed further into Premium Green and Green Deluxe, the total gross profit would be:

35 Maxim manufactures a cat food product called Green Health. Maxim currently has 10,000 bags of Green Health on hand. The variable production costs per bag are $3.30 and total fixed costs are $10,000. The cat food can be sold as it is for $8.65 per bag or be processed further into Premium Green and Green Deluxe at an additional $2,500 cost. The additional processing will yield 10,000 bags of Premium Green and 3,500 bags of Green Deluxe, which can be sold for $7.65 and $5.65 per bag, respectively. If Green Health is processed further into Premium Green and Green Deluxe, the total gross profit would be:

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 6EA: Reubens Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in...

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Dimitri Designs has capacity to produce 30,000 desk chairs per year and is currently selling all 30,000 for $240 each. Country Enterprises has approached Dimitri to buy 800 chairs for $210 each. Dimitris normal variable cost is $165 per chair, including $50 per unit in direct labor per chair. Dimitri can produce the special order on an overtime shift, which means that direct labor would be paid overtime at 150% of the normal pay rate. The annual fixed costs will be unaffected by the special order and the contract will not disrupt any of Dimitris other operations. What will be the impact on profits of accepting the order?
Maxim manufactures a hamster food product called Green Health. Maxim currently has 23,000 bags of Green Health on hand. The variable production costs per bag are $3.30 and total fixed costs are $25,000. The hamster food can be sold as it is for $9.00 per bag or be processed further into Premium Green and Green Deluxe at an additional cost. The additional processing will yield 23,000 bags of Premium Green and 4,500 bags of Green Deluxe, which can be sold for $8 and $7 per bag, respectively. Assuming Maxim further processes Green Health further into Premium Green and Green Deluxe, revenue from the two products would be: Multiple Choice $215,500 $211,500. $8,500. W
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