Profit-loss in selling finished or semi finished product


Question: Vannorman Corporation processes sugar beets in batches. A batch of sugar beets costs $75 to buy from farmers and $11 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 $11 or processed further for $20 to make the end product industrial fiber that is sold for $65. The beet juice can be sold as is for $38 or processed further for $23 to make the end product refined sugar that is sold for $84. How much profit (loss) does the company make by processing one batch of sugar beets into the end products industrial fiber and refined sugar?

  • $20
  • ($32)
  • $38
  • ($129)

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Accounting Basics: Profit-loss in selling finished or semi finished product
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