Appel Inc. has two product lines: phones and laptops. They are considering dropping the phone segment to improve their net operating income. Data for each per unit is as follows: Phones Laptops Revenue $530 $1099 Variable Costs $245 $430 Traceable Fixed Costs $300 $209 Allocated Fixed Costs $110 $130 Total Per Unit $(125) $330 Assume no allocated fixed costs are avoidable if the phone segment is dropped, but 100% of traceable fixed costs can be avoided. If Appel Inc. sells 1,824 units of phones and 555 units of laptops, how much will their net operating income increase/decrease if the phone segment is dropped? Pound vOur answor to the noarest dellar

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Appel Inc. has two product lines: phones and laptops. They are considering dropping the phone
segment to improve their net operating income. Data for each per unit is as follows:
Phones
Laptops
Revenue
$530
$1099
Variable Costs
$245
$430
Traceable Fixed Costs
$300
$209
Allocated Fixed Costs
$110
$130
Total Per Unit
$(125)
$330
Assume no allocated fixed costs are avoidable if the phone segment is dropped, but 100% of
traceable fixed costs can be avoided.
If Appel Inc. sells 1,824 units of phones and 555 units of laptops, how much will their net operating
income increase/decrease if the phone segment is dropped?
Round your answer to the nearest dollar.
Transcribed Image Text:Appel Inc. has two product lines: phones and laptops. They are considering dropping the phone segment to improve their net operating income. Data for each per unit is as follows: Phones Laptops Revenue $530 $1099 Variable Costs $245 $430 Traceable Fixed Costs $300 $209 Allocated Fixed Costs $110 $130 Total Per Unit $(125) $330 Assume no allocated fixed costs are avoidable if the phone segment is dropped, but 100% of traceable fixed costs can be avoided. If Appel Inc. sells 1,824 units of phones and 555 units of laptops, how much will their net operating income increase/decrease if the phone segment is dropped? Round your answer to the nearest dollar.
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