Party Supply is trying to decide whether or not to continue its costume segment. The information shown is available for Party Supply's business segments. Assume that neither the Direct fixed costs nor the Allocated common fixed costs may be eliminated, but will be allocated to the two remaining segments. Sales Variable costs Contribution margin Direct fixed costs Allocated common fixed costs Net income Party Supply segment data Costumes Party Supplies $110,000 50,000 60,000 $160,000 84,000 76,000 50,000 30,000 20,000 25,000 Floral Decorations $210,000 120,000 90,000 25,000 30.000 $(4,000) $15,000 $35,000 If costumes are dropped, what change will occur to profit? If the effect is negative, use a dash - not parentheses ().

Party Supply is trying to decide whether or not to continue its costume segment. The information shown is available for Party Supply's business segments. Assume that neither the Direct fixed costs nor the Allocated common fixed costs may be eliminated, but will be allocated to the two remaining segments. Sales Variable costs Contribution margin Direct fixed costs Allocated common fixed costs Net income Party Supply segment data Costumes Party Supplies $110,000 50,000 60,000 $160,000 84,000 76,000 50,000 30,000 20,000 25,000 Floral Decorations $210,000 120,000 90,000 25,000 30.000 $(4,000) $15,000 $35,000 If costumes are dropped, what change will occur to profit? If the effect is negative, use a dash - not parentheses ().

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter11: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 5E

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