Business, 06.08.2021 18:10 kiki4832

Assume a company purchases honeycombs from beekeepers for $2.00 a pound. The honey can be sold in raw form for $3.20 a pound or it can be used to make honey drop candies. Each package of candies contains three-quarters of a pound of honey and can be sold for $4.40. In addition to the cost of the honey, making and selling each container of candies incurs additional variable costs of $110 per unit. The monthly fixed costs associated with making the candies include: Master candy-maker's salary $4,450
Depreciation of candy-making equipment 400
Salary of salesperson dedicated to this product 2,000
Total fixed costs $6,850
The candy making equipment does not wear out through use and it has no resale value. Assuming the company makes and sells 8,000 containers of candy, what is the financial advantage (disadvantage) of continuing to process raw honey into candies?
a. $46,050
b. $15.650
c. $750
d. $350

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Assume a company purchases honeycombs from beekeepers for $2.00 a pound. The honey can be sold in ra...

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