Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pumpproduct line for several years. The most recent quarterly contribution format income statement for the bilge pump follows:Thalassines Kataskeves, S.A.Income Statement-Bilge PumpFor the Quarter Ended March 31SalesVariable expenses:Variable manufacturing expensesSales commissionsShippingTotal variable expensesContribution marginFixed expenses:Advertising (for the bilge pump product line)Depreciation of equipment (no resale value)General factory overheadSalary of product-line managerInsurance on inventoriesPurchasing departmentTotal fixed expensesNet operating loss*Common costs allocated on the basis of machine-hours.+Common costs allocated on the basis of sales dollars.$ 500,000$ 135,00040,00014,000189,000311,00024,000107,00036,000*117,0007,00049,000+340,000$ (29,000)Discontinuing the bilge pump would not affect sales of other product lines and would have no effect on the company's total generalfactory overhead or total Purchasing Department expenses.Required:What is the financial advantage (disadvantage) of discontinuing the bilge pump?

The Calculation is as follows:Calculation of Financial Advantage (disadvantage) of discontinuing the…

Answered: Thalassines Kataskeves, S.A., of Greece…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 4PB: West Island distributes a single product. The companys sales and expenses for the month of June are...

See similar textbooks

Similar questions

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margini Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-Line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. *Common costs allocated on the basis of sales dollars. $ 130,000 54,000 21,000 22,000 115,000 36,000 120,000 14,000 57,000 $ 440,000 Required: What is the financial advantage (disadvantage) of discontinuing the bilge pump? 205,000…
Subject:
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. +Common costs allocated on the basis of sales dollars. $ 330,000 42,000 18,000 M 270,000 80,000 105,000* 32,000 8,000 45,000 $ 850,000 390,000 460,000 540,000 $ (80,000) Discontinuing the bilge pump product line would not…
Vinubhai
Meman
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencinglosses on its bilge pump product line for several years. The most recent quarterly contribution formatincome statement for the bilge pump product line follows:Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31Sales ................................................................................................. €850,000Variable expenses:Variable manufacturing expenses ................................................. €330,000Sales commissions ....................................................................... 42,000Shipping ........................................................................................ 18,000Total variable expenses .................................................................... 390,000Contribution margin .......................................................................... 460,000Fixed expenses:Advertising…
Thalassines kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. +Common costs allocated on the basis of sales dollars. $ 135,000 45,000 11,000 29,000 102,000 38,000* 126,000 15,000 50,000+ $ 430,000 191,000 239,000 360,000 $ (121,000) Discontinuing the bilge pump product line would…
Rahul
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31 Sales $ 490,000 Variable expenses: Variable manufacturing expenses $ 139,000 Sales commissions 42,000 Shipping 17,000 Total variable expenses 198,000 Contribution margin 292,000 Fixed expenses: Advertising (for the bilge pump product line) 30,000 Depreciation of equipment (no resale value) 119,000 General factory overhead 43,000 * Salary of product-line manager 114,000 Insurance on inventories 8,000 Purchasing department 56,000 † Total fixed expenses 370,000 Net…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31 Sales $ 470,000 Variable expenses: Variable manufacturing expenses $ 124,000 Sales commissions 41,000 Shipping 19,000 Total variable expenses 184,000 Contribution margin 286,000 Fixed expenses: Advertising (for the bilge pump product line) 23,000 Depreciation of equipment (no resale value) 118,000 General factory overhead 40,000* Salary of product-line manager 125,000 Insurance on inventories 10,000 Purchasing department 44,000† Total fixed expenses 360,000 Net operating loss $ (74,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: $ 480,000 $ 136,000 50,000 16,000 202,000 278,000 Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of sales dollars. 27,000 107,000 * 47,000 115,000 10,000 58,000+ 364,000 $ (86,000) Discontinuing the bilge pump product line would…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31 Sales $ 440,000 Variable expenses: Variable manufacturing expenses $ 122,000 Sales commissions 52,000 Shipping 24,000 Total variable expenses 198,000 Contribution margin 242,000 Fixed expenses: Advertising (for the bilge pump product line) 21,000 Depreciation of equipment (no resale value) 107,000 General factory overhead 46,000* Salary of product-line manager 119,000 Insurance on inventories 7,000 Purchasing department 49,000† Total fixed expenses 349,000 Net operating loss $ (107,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the…

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

SEE MORE TEXTBOOKS