Financial disadvantage = $ (71,000)
Working
Statement showing Finantial Advantage or (Disadvantage) of Discontinuing a product line | ||
Sales | $ 420,000 | |
Variable expenses | ||
Variable Manufacturing Expenses | $ 132,000 | |
Sales Commission | $ 43,000 | |
Shipping | $ 23,000 | $ 198,000 |
Contribution | $ 222,000 | |
Avoidable Fixed Expenses | ||
Advertisement Expenses | $ 24,000 | |
Salary of Product line Manager | $ 118,000 | |
Insurance on Inventories | $ 9,000 | |
Total Avoidable Fixed Cost | $ 151,000 | |
Net Benefit of continuing or Net disadvantage of discontinuing | $ 71,000 |
.
Notes: | ||||||
1) Unavoidable Fixed Cost will not be considered because they will occur even if no production is done. | ||||||
2) Depreciation is not considered since equipment has zero salvage value and depreciation is a non cash expense. | ||||||
3) Similarly General factory overheads and Purchasing department expenses will continue to occur at same level that is why they are also excluded from calculation |
$ 420,000 $ 132,000 43,000 23,000 198,000 222,000 for the vuar ter neu March 31 Sales...
ave & E Chee 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: Thalassinea Kataskeves, s.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales $ 410,000 Variable expenses: Variable manufacturing expenses Sales conmissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge pump product 1ine) Depreciation...
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: $ 490,000 $ 122,000 45,000 11,000 178,000 312,000 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...
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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 $ 440, eee $ 129, eee 54,000 11,000 194,000 246,000 Thalassines kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Variable manufacturing expenses Sales comissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge...
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: $ 460,000 $ 135,000 48,000 _ 22,000 205,000 255,000 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...
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 $ 440, eee $ 129,000 54, eee 11, cee 194,eee 246,000 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...
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 $ 410,000 $ 123,000 Sales commissions 44,000 18,000 k Shipping Total variable expenses Contribution margin 185, eee 225,00e Fixed expenses: rint Advertising (for 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 500,000 Variable expenses: Variable manufacturing expenses Sales commissions Shipping s 130,000 45,000 22,000 ZAU 197,000 Total variable expenses Contribution margin Fixed expenses: 303,000 26,000 115,000 45,000 125,000 5,000 53,000t...
halassines 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 $ 460,000 Variable expenses: Variable manufacturing expenses $ 136,000 Sales commissions 46,000 Shipping 21,000 Total variable expenses 203,000 Contribution margin 257,000 Fixed expenses: Advertising (for the bilge pump product...
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: $ 480,000 $ 122,000 42,000 15,000 179,000 301,000 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...