Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All itsvariable costs are avoidable, and $300,000 of its fixed costs are avoidable.Segment Income (Loss)SalesVariable costsContribution marginFixed costsIncome (loss)(a) Compute the income increase or decrease from eliminating this segment.(b) Should the segment be continued or eliminated?Required A Required BComplete this question by entering your answers in the tabs below.$ 980,000700,000280,000340,000$ (60,000)Segment Elimination AnalysisCompute the income increase or decrease from eliminating this segment.Income Increase(Decrease)SalesVariable costsContribution marginFixed costsIncome (loss)Continue$0Eliminate0 $< Required A00$Required B0>

In evaluating, whether continue to invest or not in a division, the company should calculate the Relevant profit/loss of the division. Amount used to evaluate whether continue to invest in division = Revenue - Variable operating expenses - Controllable fixed costs.a. Segment Elimination Analysis Continue Eliminate Income Increase (Decrease) Sales $980,000 0 Variable costs 700,000 0 Contribution margin $280,000 0 Fixed costs 300,000 300,000 Income (loss) $(20,000) $(300,000) $(280,000) b. Segment should be continued.

Business

Accounting

Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and $300,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated? Complete this question by entering your answers in the tabs below. Required A Required B $ 980,000 700,000 280,000 340,000 $ (60,000) Compute the income increase or decrease from eliminating this segment. Income Increase (Decrease) Segment Elimination Analysis Sales Variable costs Contribution margin Fixed costs Income (loss) Continue $ 0 Eliminate 0 $ 0 0 $ 0 ||

Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and $300,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated? Complete this question by entering your answers in the tabs below. Required A Required B $ 980,000 700,000 280,000 340,000 $ (60,000) Compute the income increase or decrease from eliminating this segment. Income Increase (Decrease) Segment Elimination Analysis Sales Variable costs Contribution margin Fixed costs Income (loss) Continue $ 0 Eliminate 0 $ 0 0 $ 0 ||

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

A.4
Help Save & Che Required information [The following information applies to the questions displayed below.] Armstrong Corporation manufactures bicycle parts. The company currently has a $19,700 inventory of parts that have become obsolete due to changes in design specifications. The parts could be sold for $7,200, or modified for $10,200 and sold for $20,700. 2-a. Calculate the benefit under each alternative for disposing of the obsolete parts. 2-b. How should the obsolete parts be disposed? Complete this question by entering your answers in the tabs below. Req 2A Req 2B Calculate the benefit under each alternative for disposing of the obsolete parts. Benefit if parts are sold without modification Net benefit if parts are sold after being modified Req 2B >
The management of Wengel Corporation is considering dropping product B90D. Data from the company's accounting system appear below: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $179,000 of the fixed manufacturing expenses and $155,200 of the fixed selling and administrative expenses are avoidable if product B90D is discontinued. Required: What would be the financial advantage (disadvantage) of dropping B90D? Should the product be dropped? Net operating income (loss) would $ 745,000 $ 387,000 $ 253,400 $216,200 decline increase by if product B90D were dropped. Therefore, the product dropped
Please solve using analysis of profitability and impact. I am confused on how to define a cost between PB Seats and E seats. Although the above prompt indicates "$10,200" as an incremental cost for adding (1) E seat, this prompt confuses me while solving.
A manufacturer is considering eliminating a segment because it shows the following $6,300 loss. All $21,100 of its variable costs are avoidable, and $38,500 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be eliminated? Complete this question by entering your answers in the tabs below. Required A $ 63,300 21,100 42,200 48,500 (6,300) Required B Compute the incomo
Please do not give solution in image format ? and explain proper steps by Step.?
Granfield Company is considering eliminating its backpack division, which reported a loss for the recent year of $46,500 as shown below. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) If the backpack division is dropped, all $484,000 of its variable costs are avoidable, and $216,200 of its fixed costs are avoidable. The impact on Granfield's income from eliminating this business segment would be: Multiple Choice $494,000 decrease $216,200 increase $277,800 decrease $ 978,000 484,000 494,000 540,500 $ (46,500) $494,000 increase
Carolina Enterprise operates three product segments: sinks, bathtubs, and toilet bowls. Below are the figures showing how each product segment performed in 2022. If Carolina drops any segment, it can avoid 40% of the fixed costs allocated to the dropped segment. In 2023, should the sink segment be dropped in order to improve Carolina's financial performance? Sales Variable costs Contribution margin Fixed costs Net operating income Sinks P450,000 (220,000) 230,000 (250,000) P(20,000) Bathtubs P520,000 (315,000) 205,000 (180,000) P25,000 Toilet Bowls P480,000 (280,000) 200,000 (140,000) P60,000 No, because dropping the sink segment will cause Carolina's total net operating income to decrease by P150,000. Yes, because dropping the sink segment will cause Carolina's total net operating income to increase by P150,000. Yes, because dropping the sink segment will cause Carolina's total net operating income to increase by P130,000. No, because dropping the sink segment will cause Carolina's…
[The following information applies to the questions displayed below.] Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 44,000 units of each product. Income statements for each product follow. Sales Variable costs Contribution margin Fixed costs Income 3. Assume that the company expects sales of each product to increase to 58,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year (as shown above with columns for each of the two products). (Round "per unit" answers to 2 decimal places.) Contribution margin Income (loss) Carvings $ 774,400 464, 640 309,760 Mementos $ 774,400 154,880 619,520 187,760 497,520 $ 122,000 $ 122,000 HENNA COMPANY Contribution Margin Income Statement Carvings Units $ Per unit Total Mementos $ Per unit Total Total
What is the breakeven point under (a) variable costing and (b) absorption costing?
be discontinued. The special equipment used to produce the trampolines has A common fixed cost that is allocated on the basis of sales pesos. supervisors assigned to the model would be discharged.. Management is concerned about the continued losses shown by the round trampolines and wants a recommendation as to whether or not the line should no resale value. If the round trampoline model is dropped, the two line Problem 2, page 313-Crystal Sports Equipment (Eliminate or Retain Product Line) Requirement: Compute the increase/decrease in net operating income if the production and sale of the round trampolines is continued. Problem 2 (Eliminate or Retain a Product Line) Crystal Sports Equipment manufactures round, rectangular, and octagonal trampolines. Data on sales and expenses for the past month follow: Round P140,000 60,000 80,000 Trampoline Rectangular Octagonal P500,000 200,000 300,000 Total Sales Less variable expenses. Contribution margin.. Less fixed expenses: P360,000 P1,000,000…
Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and $330,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,097, 600 784,000 313,600 376,000 $ (62,400) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated?