Question: Chocoheaven processes cocoa beans into cocoa powder at a processing cost of $10,000 per batch. Chocoheaven can sell the cocoa powder as is, or it
Chocoheaven processes cocoa beans into cocoa powder at a processing cost of $10,000 per batch. Chocoheaven can sell the cocoa powder as is, or it can process the cocoa powder further into chocolate syrup or boxed assorted chocolates. Once processed, each batch of cocoa beans would result in the following sales revenue EEl (Cick the icon to view the sales revenue.) EDC The cost of transforming the cocoa powder into chocolate syrup would be $68,000. Likewise, the company would incur $184,000 to transform the cocoa powder into boxed assorted chocolates. The company president has decided to make boxed assorted chocolates owing to its high sales value and to the fact that the $10,000 cost of processing cocoa boans eats up" most of the cocoa powder profits. Has the president made the right or wrong decision? Explain your answer. Complete the following incremental analysis to compare selling the cocoa powder as is with processing it further. (Enter a "o' for any zero amounts.) Sell as Sel as Boxed Sell as Cocoa Chocolate Assorted Powder Syrup Chocolates Loss: Net beneft The president has made thedecision for the following reasons: (if a box is not used in the table leave the box empty, do not select a label.) Data Table Cocoa powder Chocolate syrup Boxed assorted chocolates $ 98,000 S 192.000
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