A brewery produces regular beer and a lower-carbohydrate "light" beer. Steady customers of the brewery buy 10 units of regular beer and 19 units of light beer monthly. While setting up the breweryto produce the beers, the management decides to produce extra beer, beyond that needed to satisfy customers. The cost per unit of regular beer is $32,000 and the cost per unit of light beer is$50,000. Every unit of regular beer brings in $200,000 in revenue, while every unit of light beer brings in $500,000 in revenue. The brewery needs at least $15,000,000 in revenue, and hasdetermined that the total demand will be at least 45 units of beer. Complete parts (is (a) and (b)(a) How much of each type of beer should be made so as to minimize total production costs?units of regular beer andunits of light beer should be made, for a minimum total cost of $(Type integers or decimals.)

Production Cost: All of the direct and indirect expenses incurred by enterprises when producing…

Answered: A brewery produces regular beer and a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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he production cost information for Blossom's Salsa is as follows: Blossom's Salsa Production Costs April 2020 Production 23,000 Jars of Salsa Ingredient cost (variable) $13, 800 Labor cost (variable ) 9,660 Rent (fixed) 4, 300 Depreciation (fixed) 6,000 Other (fixed) 1,400 Total $35, 160 The company is currently producing and selling 345,000 jars of salsa annually. The jars sell for $7.00 each. The company is considering lowering the price to $6.30. Suppose this action will increase sales to 391, 000 jars. What is the incremental cost associated with producing an extra 46, 000 jars of salsa?
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