Terumot, Chapter One, Mishnah Eight
This mishnah is a foil to mishnah four above, where we learned that one does not give terumah from an unfinished product in order to exempt a finished product. Here we learn that one also should not give terumah from a finished product for an unfinished product. However, the difference is that while Bet Hillel held in mishnah four that if he did give terumah, his terumah is not terumah, in todays case if he did give terumah it is valid.
1) They may not give terumah from oil for crushed olives nor may [they give terumah from] wine for trodden grapes.
2) If he did so, his terumah is terumah, but he must give terumah again.
3) The first terumah renders on its own [produce into which it falls] doubtful terumah and is subject to the added fifth, but not the second.
Section one: One may not give terumah from oil or wine for olives or grapes that have begun to be processed but have not yet completed their processing, such as crushed olives or trodden grapes.
Section two: Here we get a halakhah the likes of which we have not yet seen. On the one hand, if one does give terumah from finished produce for unfinished produce, his terumah is valid. However, he must go back and give terumah again for the wine and oil that are produced after he gave the first time.
Section three: The first terumah is real terumah, while the second is not. The mishnah lets us know this by relating that if this terumah falls into other non-terumah produce, it renders the entire mixture doubtful terumah. A non-priest who accidentally eats such a mixture will have to repay the amount he ate, plus an added fifth. However, the second terumah that he separated is not terumah that the Torah mandated, and therefore, the penalties for it falling into regular produce is not enacted. This second terumah was only a penalty on the person for having separated terumah from unfinished produce on behalf of finished produce.