Question 9.11When Rosana, CFO of Hydie Inc., first evaluated the segmented income statement below, he flew into his usual rage:"When are we having losses in our product lines, I would rather eliminate them."Product LinesTotalUVS75,000$47,000$28,000Sales$250,000$100,000$75,000$35.000$40,000$37,000Variable expenses$119,000$37,500Contribution margin$130,500$62,500Traceable fixed expenses*$98,000$31,000$30,000$32.900$400$4,400S(6,400)Common expenses, allocated$18,000$10,500Operating income (loss)$13.500S17.500)*These traceable expenses could be eliminated if the product lines to which they are traced were discontinued.Required:Recommend which segments, if any, should be eliminated. Prepare a report in good form to support your answer. Show allthe necessary calculations.

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1When Rosana, CFO of Hydie Inc., first evaluated the segmented income statement below, he flew into his usual rage: "When are we having losses in our product lines, I would rather eliminate them." Product Lines Total U V $100,000 $37.500 Sales $250,000 $75,000 $75,000 $35.000 $40,000 $37,000 $47,000 $28,000 Variable expenses $119.000 Contribution margin $130,500 S62,500 Traceable fixed expenses* $98,000 $31,000 $30,000 Common expenses, allocated $32,900 $18.000 $10,500 $4.400 Operating income (loss) -$400 $13,500 SI7.500) $16,400) *These traceable expenses could be eliminated if the product lines to which they are traced were discontinued. Required: Recommend which segments, if any, should be eliminated. Prepare a report in good form to support your answer. Show all the necessary calculations.

1When Rosana, CFO of Hydie Inc., first evaluated the segmented income statement below, he flew into his usual rage: "When are we having losses in our product lines, I would rather eliminate them." Product Lines Total U V $100,000 $37.500 Sales $250,000 $75,000 $75,000 $35.000 $40,000 $37,000 $47,000 $28,000 Variable expenses $119.000 Contribution margin $130,500 S62,500 Traceable fixed expenses* $98,000 $31,000 $30,000 Common expenses, allocated $32,900 $18.000 $10,500 $4.400 Operating income (loss) -$400 $13,500 SI7.500) $16,400) *These traceable expenses could be eliminated if the product lines to which they are traced were discontinued. Required: Recommend which segments, if any, should be eliminated. Prepare a report in good form to support your answer. Show all the necessary calculations.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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