Keep-or-Drop Decision Petoskey Company produces three products: Alanson, Boyne, and Convay. A segmented income statement, with amounts given in thousands, follows: Alanson Boyne Conway Total Sales revenue $1,280 $185 $315 $1,780 Less: Variable expenses 1,115 45 221 1,381 Contribution margin $165 $140 $94 $399 Less direct fixed expenses: Depreciation 50 15 14 79 Salaries 95 85 120 300 Segment margin $20 $40 $(40) $20 Direct fixed expenses consist of depreciation and plant supervisory salaries. All depreciation on the equipment is dedicated to the product lines. None of the equipment can be sold. Assume that each of the three products has a different supervisor whose position would remain if the associated product were dropped. Required: CONCEPTUAL CONNECTION: Estimate the impact on profit that would result from dropping Convway. Enter amount in full, rather than in thousands. For example, "15000" rather than "15". Decrease v $ 75,000 x Should Petoskey keep or drop Conway? Keep V

Keep-or-Drop Decision Petoskey Company produces three products: Alanson, Boyne, and Convay. A segmented income statement, with amounts given in thousands, follows: Alanson Boyne Conway Total Sales revenue $1,280 $185 $315 $1,780 Less: Variable expenses 1,115 45 221 1,381 Contribution margin $165 $140 $94 $399 Less direct fixed expenses: Depreciation 50 15 14 79 Salaries 95 85 120 300 Segment margin $20 $40 $(40) $20 Direct fixed expenses consist of depreciation and plant supervisory salaries. All depreciation on the equipment is dedicated to the product lines. None of the equipment can be sold. Assume that each of the three products has a different supervisor whose position would remain if the associated product were dropped. Required: CONCEPTUAL CONNECTION: Estimate the impact on profit that would result from dropping Convway. Enter amount in full, rather than in thousands. For example, "15000" rather than "15". Decrease v $ 75,000 x Should Petoskey keep or drop Conway? Keep V

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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Accounting BUY Chapte... Managerial Accounting 15th Edition ISBN: 9781337912020 Author: Carl Warren, Ph.d. Cma William B. Tayler Publisher: South-Western College Pub Problem 5BE Section... Question Sales Mix and Break-Even Analysis Megan Company has fixed costs of $299,700. The unit selling price, variable cost per unit, and contribution margin per unit for the company's two products follow: Product Model Selling Price Variable Cost per Unit Contribution Margin per Unit Yankee $210 $120 $90 Zoro 150 100 50 The sales mix for products Yankee and Zoro is 10% and 90%, respectively. Determine the break-even point in units of Yankee and Zoro. a. Product Model Yankee 3,330 X units b. Product Model Zoro < Feedback See similar textbooks units ▼ Check My Work Subtract the combined unit variable cost from the combined unit selling price. Divide the fixed costs by the combined unit contribution margin to find break-even point in units. Units for Yankee and Zoro will be break-even point in units…
Keep-or-Drop Decision Charlevoix Company produces three products: Torch, Elk, and Walloon. A segmented income statement, with amounts given in thousands, follows: Line Item Description Torch Elk Walloon Total Sales revenue $1,280 $185 $315 $1,780 Less: Variable expenses 1,115 45 252 1,412 Contribution margin $165 $140 $63 $368 Less direct fixed expenses: Depreciation 50 15 10 75 Advertising 95 85 76 256 Segment margin $20 $40 $(23) $37 Direct fixed expenses consist of depreciation and advertising. All depreciation on the equipment is dedicated to the product lines. None of the equipment can be sold. Assume that, each of the three products has a different marketing campaign whose advertising would be eliminated if the associated product were dropped. Assume that 30% of the Torch customers choose to buy from Charlevoix because it offers a full range of products, including Walloon. If Walloon were no longer available from Charlevoix, these customers…
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Keep-or-Drop Decision Petoskey Company produces three products: Alanson, Boyne, and Conway. A segmented income statement, with amounts given in thousands, follows: Boyne Conway $270 Sales revenue Less: Variable expenses Contribution margin Less direct fixed expenses: Depreciation Salaries Alanson $1,280 $185 1,115 $165 50 95 $20 45 $140 15 85 $40 216 $54 12 100 $(58) Total $1,735 1,376 $359 77 280 $2 Segment margin Direct fixed expenses consist of depreciation and plant supervisory salaries. All depreciation on the equipment is dedicated to the product lines. None of the equipment can be sold. Assume that each of the three products has a different supervisor whose position would be eliminated if the associated product were dropped. Required: Conceptual Connection: Estimate the impact on profit that would result from dropping Conway. Enter amount in full, rather than in thousands. For example, "15000" rather than "15".
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