You have been approached by the CFO with a recommendation to discontinue all products that are generating an operating loss based on the following managerial report: Product A Product B Product C Sales revenue $100,000 $208,000 $95,000 Variable Costs $45,000 $32,000 $56,000 Traceable Fixed Costs $28,000 $52,000 $43,000 Common Fixed Costs $39,000 $22,000 $59,000 Operating Income ($12,000) $102,000 ($63,000) Which product(s) would you recommend to the CFO to discontinue? Only Product B Only Product C Product A and B None of the products should be discontinued Product B and C Only Product A Product A and C
You have been approached by the CFO with a recommendation to discontinue all products that are generating an operating loss based on the following managerial report: Product A Product B Product C Sales revenue $100,000 $208,000 $95,000 Variable Costs $45,000 $32,000 $56,000 Traceable Fixed Costs $28,000 $52,000 $43,000 Common Fixed Costs $39,000 $22,000 $59,000 Operating Income ($12,000) $102,000 ($63,000) Which product(s) would you recommend to the CFO to discontinue? Only Product B Only Product C Product A and B None of the products should be discontinued Product B and C Only Product A Product A and C
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
You have been approached by the CFO with a recommendation to discontinue all products that are generating an operating loss based on the following managerial report:
| Product A | Product B | Product C | |
| Sales revenue | $100,000 | $208,000 | $95,000 |
| Variable Costs | $45,000 | $32,000 | $56,000 |
| Traceable Fixed Costs | $28,000 | $52,000 | $43,000 |
| Common Fixed Costs | $39,000 | $22,000 | $59,000 |
| Operating Income | ($12,000) | $102,000 | ($63,000) |
Which product(s) would you recommend to the CFO to discontinue?
Only Product B
Only Product C
Product A and B
None of the products should be discontinued
Product B and C
Only Product A
Product A and C
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