Hi Please give me step by step instructions to see how I get the correct answer. The decision to Discontinue a Product On the basis of the following data, the general manager of Featherweight Shoes Inc. decided to discontinue Children's Shoes because it reduced income from operations by $17,000. Featherweight Shoes Inc.Product-Line Income StatementFor the Year Ended April 30, 2016 Children's Shoes Men's Shoes Women's Shoes Total Sales $235,000 $300,000 $500,000 $1,035,000 Costs of goods sold: Variable costs $130,000 $150,000 $220,000 $500,000 Fixed costs 41,000 60,000 120,000 221,000 Total cost of goods sold $171,000 $210,000 $340,000 $721,000 Gross profit $64,000 $90,000 $160,000 $314,000 Selling and adminstrative expenses: Variable selling and admin. expenses $46,000 $45,000 $95,000 $186,000 Fixed selling and admin. expenses 35,000 20,000 25,000 80,000 Total selling and admin. expenses $81,000 $65,000 $120,000 $266,000 Income (loss) from operations $(17,000) $25,000 $40,000 $48,000 If the children Shoe's are discontinued, the company's ________________ Income or loss? would _______________________ increase or decrease by $. (dollar amount ___________________________
Hi Please give me step by step instructions to see how I get the correct answer. The decision to Discontinue a Product On the basis of the following data, the general manager of Featherweight Shoes Inc. decided to discontinue Children's Shoes because it reduced income from operations by $17,000. Featherweight Shoes Inc.Product-Line Income StatementFor the Year Ended April 30, 2016 Children's Shoes Men's Shoes Women's Shoes Total Sales $235,000 $300,000 $500,000 $1,035,000 Costs of goods sold: Variable costs $130,000 $150,000 $220,000 $500,000 Fixed costs 41,000 60,000 120,000 221,000 Total cost of goods sold $171,000 $210,000 $340,000 $721,000 Gross profit $64,000 $90,000 $160,000 $314,000 Selling and adminstrative expenses: Variable selling and admin. expenses $46,000 $45,000 $95,000 $186,000 Fixed selling and admin. expenses 35,000 20,000 25,000 80,000 Total selling and admin. expenses $81,000 $65,000 $120,000 $266,000 Income (loss) from operations $(17,000) $25,000 $40,000 $48,000 If the children Shoe's are discontinued, the company's ________________ Income or loss? would _______________________ increase or decrease by $. (dollar amount ___________________________
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Hi
Please give me step by step instructions to see how I get the correct answer.
The decision to Discontinue a Product
On the basis of the following data, the general manager of Featherweight Shoes Inc. decided to discontinue Children's Shoes because it reduced income from operations by $17,000.
| Featherweight Shoes Inc. Product-Line Income Statement For the Year Ended April 30, 2016 |
||||||||||
| Children's Shoes | Men's Shoes | Women's Shoes | Total | |||||||
| Sales | $235,000 | $300,000 | $500,000 | $1,035,000 | ||||||
| Costs of goods sold: | ||||||||||
| Variable costs | $130,000 | $150,000 | $220,000 | $500,000 | ||||||
| Fixed costs | 41,000 | 60,000 | 120,000 | 221,000 | ||||||
| Total cost of goods sold | $171,000 | $210,000 | $340,000 | $721,000 | ||||||
| Gross profit | $64,000 | $90,000 | $160,000 | $314,000 | ||||||
| Selling and adminstrative expenses: | ||||||||||
| Variable selling and admin. expenses | $46,000 | $45,000 | $95,000 | $186,000 | ||||||
| Fixed selling and admin. expenses | 35,000 | 20,000 | 25,000 | 80,000 | ||||||
| Total selling and admin. expenses | $81,000 | $65,000 | $120,000 | $266,000 | ||||||
| Income (loss) from operations | $(17,000) | $25,000 | $40,000 | $48,000 |
If the children Shoe's are discontinued, the company's ________________ Income or loss?
would _______________________ increase or decrease by $. (dollar amount ___________________________
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