Sohr Corporation Processes Sugar Beets That It Purchases from Farmers

question 120

Multiple Choice

Sohr Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in batches. A batch of sugar beets costs $50 to buy from farmers and $15 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 $20 or processed further for $19 to make the end product industrial fiber that is sold for $58. The beet juice can be sold as is for $41 or processed further for $23 to make the end product refined sugar that is sold for $58.
-How much profit (loss) does the company make by processing the intermediate product beet juice into refined sugar rather than selling it as is?

• A)$(71)
• B)$(6)
• C)$(39)
• D)$(21)

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Definitions:

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