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Calculate the net benefit under each alternative

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NaturalMaid processes organic milk into plain yogurt. NaturalMaid sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of $840, yields 300 gallons of plain yogurt. NaturalMaid sells the one-gallon tubs for $5 each and spends $0.14 for each plastic tub. Natural- Maid has recently begun to reconsider its strategy. NaturalMaid wonders if it would be more profitable to sell individual-size portions of fruited organic yogurt at local food stores. NaturalMaid could further process each batch of plain yogurt into 6,400 individual portions (3/4 cup each) of fruited yogurt. A recent market analysis indicates that demand for the product exists. NaturalMaid would sell each individual portion for $0.58. Packaging would cost $0.10 per portion, and fruit would cost $0.11 per portion. Fixed costs would not change

Question 1: Calculate the net benefit under each alternative.

Reference no: EM132482221

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