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Sweeter Side produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in
Sweeter Side produces hot cocoa mix. The company has two divisions, each operating as a profit center. The transportation division purchases raw cocoa in the Ivory Coast and transports it to the mixing division in Atlanta, Georgia. The mixing division processes the raw cocoa into the cocoa mix. It takes two pounds of raw cocoa to yield one pound of cocoa mix. Variable and fixed costs per pound of raw cocoa in the transportation division and variable and fixed costs per pound of cocoa mix in the mixing division area as follows: (Click the icon to view the data.) The market price for a pound of raw cocoa supplied to the mixing division in Atlanta is $15. Sweeter Side can sell each pound of hot cocoa mix for $70.
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