P210,000 190,000 P 20,000 50,000 P (30,000)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 87PSB
Related questions
Question
Management is considering the discontinuance of the manufacture and sale of Product G2 at the beginning of the current year. The discontinuance would have no effect on the total fixed costs and expenses or on the sales of Products F1 and H3. What is the amount of change in net income for the current year that will result from the discontinuance of Product G2?
P30,000 decrease
P20,000 decrease
P20,000 increase
P30,000 increase
![The condensed income statement for a business for the past year is presented as follows:
Product
F1
P300,000
180,000
P120,000
50,000
P 70.000
G2
P210,000
Sales
Less variable costs
Contribution margin
Less fixed costs
Income (loss) from operation
190,000
P 20,000
50,000
P (30,000)
H3
P340,000
220,000
P120,000
40,000
P 80.000
Total
P850,000
590,000
P260,000
140,000
P120,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe4b8067c-d183-46cb-8cb1-4f99326c45ad%2F181622e2-f74d-4267-b944-a6a79730cc83%2Flls9syd_processed.png&w=3840&q=75)
Transcribed Image Text:The condensed income statement for a business for the past year is presented as follows:
Product
F1
P300,000
180,000
P120,000
50,000
P 70.000
G2
P210,000
Sales
Less variable costs
Contribution margin
Less fixed costs
Income (loss) from operation
190,000
P 20,000
50,000
P (30,000)
H3
P340,000
220,000
P120,000
40,000
P 80.000
Total
P850,000
590,000
P260,000
140,000
P120,000
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
![Survey of Accounting (Accounting I)](https://www.bartleby.com/isbn_cover_images/9781305961883/9781305961883_smallCoverImage.gif)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
![Survey of Accounting (Accounting I)](https://www.bartleby.com/isbn_cover_images/9781305961883/9781305961883_smallCoverImage.gif)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning