Stark Co has spent $33,000 to produce and package 8,000 gallons of S7 chemical, which can...

 

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Stark Co has spent $33,000 to produce and package 8,000 gallons of S7 chemical, which can be sold as is for $6 per gallon. If they choose to, Stark Co can spend money to convert all of the S7 chemical into hand sanitizer. This processing will yield a total of 5,000 gallons of hand sanitizer that can be sold for $15 per gallon. The additional processing will require a variable cost of $1.9 per gallon of hand sanitizer and Stark Co would have to purchase a special machine for $5,000 that has no alternative use or value. If the company decides to process further into hand sanitizer, how would income be impacted? Enter your answer as positive number if income would increase, negative if income would decrease. Stark Co has spent $33,000 to produce and package 8,000 gallons of S7 chemical, which can be sold as is for $6 per gallon. If they choose to, Stark Co can spend money to convert all of the S7 chemical into hand sanitizer. This processing will yield a total of 5,000 gallons of hand sanitizer that can be sold for $15 per gallon. The additional processing will require a variable cost of $1.9 per gallon of hand sanitizer and Stark Co would have to purchase a special machine for $5,000 that has no alternative use or value. If the company decides to process further into hand sanitizer, how would income be impacted? Enter your answer as positive number if income would increase, negative if income would decrease.

Answer rating: 100% (QA)

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