Incremental Analysis for Discontinuation Decision can have two way affect to the Business
Explanation:
1. Contribution Margin Lost- If the special eats is discontinued then obviously it would affect (decrease) the profit margin that the Business would be enjoying before the product discontinues
Less:
2. Fixed Cost Saving - This would generally increase as the expenditure of the organisation would decrease.
Depending upon how the product performed the company can be benefited as well as incur loos at the same time .Discontinuation of a product is generally done when the company is facing losses.
Answer:
The correct answer is:
Expenditures—2017 in the amount of $200. (C.)
Explanation:
This scenario describes a record that was less than the actual amount spent on the General Fund supplies. The amount recorded was $2,000, meanwhile the actual amount spent was $2,000. This entails that an amount worth $200 was not recorded, hence it will be debited as expenditures, but the question now is where the debit will be recorded?
This review was done in January 2017, meaning that the income statement for the 2016 Fiscal year must have been balanced, hence the amount will be an expenditure recorded in 2017, but the particulars will have a description that it was a carried over expenditure from 2016. Therefore $200 will be debited from 2017 as expenditures.
Answer
The answer and procedures of the exercise are attached in the following archives.
Notes: All working are part of answer and provided as an ‘Equation Column’
BOLDED portion is the part of required answer
Requirement 1: Budgeted Production in Sq. yards
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
Answer:
Option B
Explanation:
Both Nadia and Samantha have insured their cars and willing to pay $100 over the expected loss for insurance. If the car is stolen the company would pay expected loss and would earn nothing and if the car is not stolen the company would not be liable for any loss and would earn $200, Therefore the company would earn between $0 and $200.
