What is the incremental revenue from further processing


Problem:

Annie B's Homemade Ice Cream is an ice cream shop in Asheville, NC. Annie's Homemade makes the brownies it adds to vanilla fudge brownie ice cream. The company is deciding whether it should sell brownies as a stand-alone product or always cut them into smaller pieces and add them to the vanilla fudge brownie ice cream. The cost to make 12 three-ounce brownies is $4.00. Each three-ounce brownie could be sold for $2.00. It costs $0.20 to cut a three-ounce brownie into pieces and add it to ice cream. A six-ounce serving of vanilla fudge brownie uses one ounce of brownies plus $1.10 of other ingredients and labor while selling for $5.00. What is the incremental revenue from further processing a three-ounce brownie?

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Accounting Basics: What is the incremental revenue from further processing
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