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Erosion costs. Heavenly Cookie Company reports the following annual sales and costs for its current product line: ChocolateSnicker Volume Price Cost Chip 255,000 $0.80 $0.20
Erosion costs. Heavenly Cookie Company reports the following annual sales and costs for its current product line: ChocolateSnicker Volume Price Cost Chip 255,000 $0.80 $0.20 doodle 205,000 50 46 $0.20 Peariut Buttor 141,000 $0.55 50.17 emonCream Droplil Filled 90,000 $0.52 S0.34 83,000 $0.45 $0.24 Heavenly is thinking of adding Mississippi Mud brownies to the product line. The ultra-rich brownies would sell for S0 94 a piece and cost $0.75 to produce. The forecasted brownie volume is 222,000 per year. Introduction af brownies, however, will Teduce cookie sales by 193,000, with the following drops in sales per cookie 112,000 in chocolate chip, 38,000 in snickerdoodle, 26,000 in peanut butter, 8,000 in lemon drop, and 9,000 in cream-filled. What is the erosion cost of introducing the brownies? What is the net change in annual margn if Mississippi Mud brownies are added to the product line What is the erosion cost of introducing the brownies
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