Question
Sell as is or Process Further CocoaJoy processes cocoa beans into cocoa powder at a processing cost of $10,000 per batch. Each batch of
Sell as is or Process Further CocoaJoy processes cocoa beans into cocoa powder at a processing cost of $10,000 per batch. Each batch of cocoa powder sells for $15,000. CocoaJoy can also process the cocoa powder further into chocolate syrup or boxed assorted chocolates. The cost of this additional processing for chocolate syrup is $67,000 while the cost of additional processing for boxed assorted chocolates is $175,000. A batch of chocolate syrup sells for $101,000 while a batch of boxed assorted chocolates sells for $196,000. What should CocoaJoy do and why? - A. Process further and sell boxed assorted chocolates CocoaJoy will be better off by a $6,000 net increase in operating income if boxed assorted chocolates are sold vs. selling cocoa powder B. Process further and sell boxed assorted chocolates - CocoaJoy will be better off by a $16,000 net increase in operating income if boxed assorted chocolates are sold vs. selling cocoa powder C. Process further and sell chocolate syrup - CocoaJoy will be better off by a $29,000 net increase in operating income if chocolate syprup is sold vs. selling cocoa powder D. Process further and sell chocolate syrup - CocoaJoy will be better off by a $19,000 net increase in operating income if chocolate syrup is sold vs. selling cocoa powder E.
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