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GaryK [48]
3 years ago
10

The management of Kabanuck Corporation is considering dropping product V41B. Data from the company's accounting system appear be

low:Sales $939,000Variable expenses $413,500Fixed manufacturing expenses $525,500Fixed selling and administrative expenses $353,000All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $215,500 of the fixed manufacturing expenses and $126,500 of the fixed selling and administrative expenses are avoidable if product V41B is discontinued.What would be the effect on the company's overall net operating income if product V41B were dropped?
Business
1 answer:
topjm [15]3 years ago
8 0

Answer:

It would be a differential loss of 174,500

Explanation:

Continue Or discontinued  

                       Continued    Discontinued Differential

Sales                     930,000            -                   (930,000)

Variable                    (413,500)           -                     413,500

Tracable Fixed Cost (342,000)           -                    342,000

Allocate cost           (536,500)      (536,500)               -  

Result                   (362,000)      (536,500)       (174,500)

If discountinued, sales, variable cost and tracable fixed cost are zero

<u>Tracable cost</u>

215,500 + 126,500

<u>Allocate cost</u>

total fixed cost - tracable cost

(525,500 + 353,000)   - 342,000

Once we got the numbers we calculate the diffferential income/loss

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2 years ago
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3 0
3 years ago
The basic laws of forecasting help to avoid misapplication or misrepresentation of forecast results. Law 3 states, __________. M
pav-90 [236]

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C.

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-Plan production or order materials

There are types of forecast

Demand, depend on the firm level or the market level.

Supply, depend on number of current producers and suppliers, projected aggregate supply levels, and technological and political trends.

Price, depend on cost of supplies and services, market price for firm´s product or service.

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3 0
3 years ago
Use the information below to answer the following question. The following lots of a particular commodity were available for sale
Andreas93 [3]

Answer:

$1,510

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Total = $740 + $770 = $1,510

I hope my answer helps you

8 0
3 years ago
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