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Erosion costs. Heavenly Cookie Company reports the following annual sales and costs for its current product line: Click on this icon o to downiood the
Erosion costs. Heavenly Cookie Company reports the following annual sales and costs for its current product line: Click on this icon o to downiood the data from this tabio Heavenly is thinking of adding Mississippi Mud brownies to the product ine. The ultra-rich brownies would sell for $0.97 a piece and cost $0.75 to produce. The forecasted brownie volume is 221,000 per year. Introduction of brownies, however, will reduce cooke sales by 180,500, with the following drops in sales per cookie: 100,000 in chocolate chip, 37,000 in snickerdoodie, 26,000 in peanut butter, 8,000 in femon drop, and 9,500 in cream-filfed. What is the orosion cost of introducing the brownies? What is the net change in annual margin if Misslssippi Mud brownies are added to the product line? What is the efosion cost of introducing the brownies? (Round to the nearest doline)
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