Mountain Valley Orchards is reconsidering the pricing of its fresh-squeezed peach juice in half-gallon containers. Variable...
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Accounting
Mountain Valley Orchards is reconsidering the pricing of its fresh-squeezed peach juice in half-gallon containers. Variable costs per container are $1.55. Based on market study, management has determined that the price per half-gallon should be between $2.55 and $3.05. Identify the price to maximize contribution margin and prepare a cash flow statement.
Price per Half Gallon
Estimated Demand (Half-Gallon Units)
$2.55
98,000
$2.60
95,000
$2.65
92,000
$2.70
89,000
$2.75
86,000
$2.80
83,000
$2.85
80,000
$2.90
77,000
$2.95
74,000
$3.00
71,000
$3.05
68,000
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