KaZoom Cola produces a lemon-lime soda. The production process starts with workers mixing the lemon syrup and lime flavors in a secret recipe. The company enhances the combined syrup with caffeine. Finally, the company dilutes the mixture with carbonated water. KaZoom Cola incurs the following costs (in thousands):

1.	Classify each of the listed costs according to its category in the value chain (R&D, Design, Production, Marketing, Distribution, or Customer Service.)
2.	Further break down production costs into three subcategories: Direct Materials (DM), Direct Labor (DL), or Manufacturing Overhead (MOH).
3.	Compute the total costs for each value chain category.
4.	How much are the total product costs?
5.	Suppose the managers of the R&D and design functions receive year-end bonuses based on meeting their unit's target cost reductions. What are they likely to do? How might this affect costs incurred in other elements of the value chain?

Plant janitors' wages Delivery truck drivers' wages Payment for new recipe Depreciation on delivery trucks Plant utilities Lime flavoring Rearrangment of plant layout Bottles Salt Sales commissions Production costs of "cents-off' store coupons for customers Lemon syrup Replacement of products with expired dates upon customer complaint Depreciation on plant and equipment Wages of workers who mix syrup Customer hotline Freight-in on materials 1.200 s 235 s 1.140 S 175 s 300 1,080 $ 2.000 s 1,490 45 275 S 750 $ 20.000 s 60 $ 2.700 S 8.500 S 170 S 1.600 Mango Service Value Chain Cost Classification Production Direct Direct Manufacturing Cost R&D Labor Overed Plants wagers Truck drivers wages Payment for new recipe Depreciation on trucks Plants Lime favoring Rearrangeplant layout Bottes Salt Sales commissions Production costs of ents of coupons Lemon yup Replace products with capired dat Depreciation on plant and equipment Wages of workers who exy Customer hoe Frighten on material Totat costs Requirement 4. How much are the total product costs? Determine the formula then calculate the total product conta Total productos Requirements, support the managers of the R&D and design functions toch eend houses and an menting their entre tarpot cost induction What are they that to do? How might this affect costs incurred in other elements of the value cham? The manager of R&D and Design welkely to This can couts of intervalue-chain elements Select the answer that shows how cuting costs might attect other elements of the val decre O A If cutting RSD and Design coste ads to lower quality soda customer service Ismayin 3. If the recipe is not designed to the code is easy to produce or the production increase Mid-out production costs will be higher than they need to be OC I the recipe is not adjusted to consumer tiste, more marketing may be required and sales may decine D. All of the above Choose from any list or entrany number in the input folds and then continue to the next