Tha Dogg Pound’s highly anticipated debut album “was the nail in the coffin” for In-terscope, says a source at the label. Produced by the rap duo Kurupt and Daz (Snoop Doggy Dogg’s cousin), “Dogg Food” is filled with profanity, mi-sogynistic lyrics, graphic sex and violence. (It’s expected to shoot to No. 1.) Tha Dogg Pound had plenty of time to tone down all the attitude before the CD’s scheduled release in August, but didn’t. When Michael Fuchs, chairman of Time Warner’s musicdivision, heard the album, he “realized there was no middle ground,” says an Inter-scope source.

Interscope was ready for the sacrificial knife. Insiders figure the’ll land at MCA or Polygram within two weeks. Time Warner will continue to distribute other Interscope artists like Nine Inch Nails through March 1996. Inter-scope has three years to pay hack the nearly $120 million Time Warner originally put in. Which means it could wind up losing money on its investment. But that’s the rap even the biggest conglomerate takes for bucking the current mood of morality.