A condensed income statement by product line for Healthy Beverage Inc. indicated the following for Fruit Cola for the past year:
Sales $12,750,000 Cost of goods sold 8,500,000 Gross profit $ 4,250,000 Operating expenses 6,000,000 Loss from operations $ (1,750,000) It is estimated that 25% of the cost of goods sold represents fixed factory overhead costs and that 15% of the operating expenses are fixed. Because Fruit Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued. a. Prepare a differential analysis dated January 5 to determine whether Fruit Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". Use a minus sign to indicate a loss.
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Answer:
Explanation:
I think your question is missed of key information, allow me to attach the photo question below.
The quantity demanded is 30 units when the price is 60, we use the reconciliation method on the demand line.
