If management decides to eliminate this product line,net income? A company has three product lines, one of which reflects thefollowing results:SalesVariable expenses400,000250,000Contribution margin 150,000Fixed expensesNet loss240,000(90,000)If this product line is eliminated, 65% of the fixed expenses can beeliminated, and the other 35% will be allocated to other productlines.If management decides to eliminate this product line, the company'snet income will:A) Increase by $96,000B) Decrease by $150,000C) Decrease by $6,000D) Increase by $6,000

Explanation of Contribution Margin:Contribution Margin is the amount remaining after subtracting…

Answered: A company has three product lines, one…

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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The company's net income will?
A company has three product lines, one of which reflects the following results: Sales Variable expenses Contribution margin Fixed expenses Net loss O decrease by $4000. O increase by $4000 decrease by $82000 $181000 99000 O increase by $48000 82000 130000 If this product line is eliminated, 60% of the fixed expenses can be eliminated and the other 40% will be allocated to other product lines. If management decides to eliminate this product line, the company's net income will $ (48000)
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A company has five product lines, one of which has Fixed expenses of $173,657 and a Net loss of $40,203. If this product line is eliminated, 48% of the fixed expenses can be eliminated and the remainder will be allocated to other product lines. If management decides to eliminate this product line, the amount the company's net income will increase or decrease(-) is? Round to the nearest dollar and put a negative sign - before a decrease. Do not type the dollar sign.
ABC Co. plans to discontinue a department that has a contribution margin of P60,000 and P100,000 in fixed costs. Of the fixed costs, P60,000 would still continue even if the department is closed. The effect of this discontinuance on Indian’s overall net operating income would be A. Zero effect B. increase of P20,000 C. decrease of P20,000 D. increase of P40,000 Answer with explanation please. Thank you
View Policies Current Attempt in Progress A company has three product lines, one of which reflects the following results: $244000 Sales Variable expenses 141000 Contribution margin 103000 Fixed expenses 130000 $ (27000) Net loss If this product line is eliminated, 60% of the fixed expenses can be eliminated and the other 40% will be allocated to other product lines. If management decides to eliminate this product line, the company's net income will O decrease by $25000. decrease by $103000. increase by $27000. increase by $25000.
pls show solutions Manor Company plans to discontinue a department that has a contribution margin of $25,000 and $50,000 in fixed costs. Of the fixed costs, $21,000 cannot be eliminated. The effect on the profit of Manor Company ofdiscontinuing this department would be an increase or decrease of how much?
Current Attempt in Progress A company has three product lines, one of which has the following results: Sales Variable expenses Contribution margin Fixed expenses Net loss Save for Later esc If this product line is eliminated, 60% of the fixed expenses will be eliminated and the other 40% will be allocated to other product lines. If management decides to eliminate this product line, the company's net income will ! O increase by $35000. O increase by $15000. O decrease by $90000. O decrease by $15000. 1 $221000 Q 131000 A 90000 125000 $(35000) 2 W S #3 с E D $ 4 R % 5 G Search or type URL FL Attempts: 0 of 1 used MacBook Pro T 6 G Y & 7 H Submit Answer X 8 U 9
Central Industries has three product lines: A, B, and C. The information given below is available. Central Industries is thinking about dropping Product C because it is reporting a loss. Assume Central Industries drops Product C ?and does not replace it. What will happen to operating income Sales Variable costs Contribution margin. Avoidable fixed costs Unavoidable fixed costs Operating income(loss) Product A $100,000 76.000 24,000 9,000 6.000 $9.000 Product B S90,000 48,000 42,000 18,000 9.000 $15.000 Product C $44,000 35,000 9,000 3,000 7.700 S(1.700) increase by $600 increase by S1,700 () decrease by S6,000 decrease by S9,000 ) increase by S2,400 ()
Cesar Company has three product lines: A, B and C. The information given below is available. Assume Cesar Company drops Product C. Cesar Company then doubles the production and sales of Product B without ?increasing fixed costs. What will happen to operating income Sales Variable costs Contribution margin Avoidable fixed costs Unavoidable fixed costs Operating income(loss) Product A S100,000 76,000 24,000 9,000 6.000 $9.000 Product B $90,000 48,000 42,000 18,000 9,000 $15.000 Product C $44,000 35,000 9,000 3,000 7.700 S(1,700) increase by $18,000 O increase by ST15,000 () increase by $36,000 increase by $24,000 increase by $42,000 )

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