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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 $320,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,058,400 756,000 302,400 364,000 $ (61,600) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated?

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 $320,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,058,400 756,000 302,400 364,000 $ (61,600) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated?

FINANCIAL ACCOUNTING
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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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 $320,000 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 $ 1,058,400 756,000 302,400 364,000 $ (61,600) Compute the income increase or decrease from eliminating this segment. Segment Elimination Analysis Income (loss) Continue Eliminate < Required A Income Increase (Decrease) Required B >
Transcribed Image Text: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 $320,000 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 $ 1,058,400 756,000 302,400 364,000 $ (61,600) Compute the income increase or decrease from eliminating this segment. Segment Elimination Analysis Income (loss) Continue Eliminate < Required A Income Increase (Decrease) Required B >
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