A study has been conducted to determine if Product A should be dropped. Total sales of the product are $200,000 per year; total variable expenses are $140,000 per year. Total fixed expenses charged to the product are $90,000 per year. The company estimates that $40,000 of these fixed expenses will continue even if the product is dropped. These data indicate that if Product A is dropped, the company's overall operating income per year would change by how much? O a. An increase of $30,000. O b. An increase of $20,000. O c. A decrease of $10,000. Od. A decrease of $20,000.
Q: Beginning inventory Merchandise Finished goods Cost of merchandise purchased Cost of goods…
A: Cost of Goods Sold (COGS) represents the direct costs associated with the production of goods or…
Q: Transaction Assets |1 2 3 4 5 6 7 8 9 10 11 Total Cash Accounts Receivable 11000 +- (4,000) +- (400)…
A: Accounting Equation: It is the fundamental equation which states thatAssets = Liabilities+Equity…
Q: Howarth Manufacturing Company purchased equipment on June 30, 2020, at a cost of $175,000. The…
A: Straight Line Method Annual Depreciation = (Cost - Salvage value)/Useful lifeCost of assets-Salvage…
Q: Jurvin Enterprises is a manufacturing company that had no beginning inventories. A subset of the…
A: Unadjusted Cost of goods sold = Materials Used + Direct Labor + Manufacturing Overhead…
Q: Portions of the financial statements for Peach Computer are provided below. PEACH COMPUTER Income…
A: Cash flow statement :— It is one of the financial statements that shows change in cash and cash…
Q: The average price of a gallon of gas in 2018 increased $0.30 (12.4 percent) from $2.42 in 2017 to…
A: After deducting all of the expenditures that are associated with the production and sale of a…
Q: Whirly Corporation's contribution format income statement for the most recent month is shown below:…
A: Income statement is a financial statement that shows profitability, total revenue and total expenses…
Q: Question Content Area The charter of a corporation provides for the issuance of 101,000 shares of…
A: The objective of the question is to calculate the number of shares outstanding. The number of shares…
Q: High interest coverage ratio does not indicate O a. The ability to pay future dividends O b. No…
A: Interest Coverage Ratio: This is a financial ratio which indicates the entity's ability to pay…
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
A: The income statement is prepared to estimate the profitability of the business for the current…
Q: Required information [The following information applies to the questions displayed below.] Kiyara…
A: Requirement (a):Business income of Guardian Corporation = $334,000Kiyara′s Share = 50% of Business…
Q: The partnership contract of Ali & Yousif LLP provided for salaries of $45,000 to Ali and $35,000 to…
A: Distribution of profit in partnership firm:—1] Profit/Loss of the firm is distributed between the…
Q: Morant, Inc. uses a job order costing system and applies overhead on the basis of 125% of direct…
A: Inventory is the amount of goods that an entity has in hand. It is a current asset. It is reported…
Q: vMolding numbers on left. Painting on right High Desert Potteryworks makes a variety of pottery…
A: MoldingPaintingPredetermined overhead rate : $ 5.40 $…
Q: Hi-Tek Manufacturing, Incorporated, makes two types of industrial component parts-the B300 and the…
A: It is an accounting method that is used to determine the cost of making determine profit.It is used…
Q: -Copr., Goedl Job Blue2B incurred the following: $15,000 direct material, $12,600 direct labor, 800…
A: Job costing is a method used by businesses to track and allocate costs to specific jobs or projects.…
Q: Submit your final work via moodle.gusto-education.com by 10th February 2024 (Saturday) 23:59 PM…
A: The objective of the question is to understand how Columbus Canopy Company (CCC) can use management…
Q: Which of the following is a period cost? a. Property taxes on the production facilities. b. The…
A: Answer:- Period costs meaning:- Any expenses a business incurs that are not directly tied to the…
Q: Cody and Chelsi, who are married to each other, own their home together titled as community…
A: Federal Income Tax -The federal government is responsible for collecting federal income taxes,…
Q: Pizza Vesuvio makes specialty Month Labor Cost ($) January 9,790 February 7,300 7,831 March April…
A: The costs incurred for the production are classified as fixed and variable Costs. The high - low…
Q: Journal entry worksheet < 2 Transaction Note: Enter debits before credits. d. 3 The company…
A: The depreciation is the allocating of the cost of the assets over its useful life evenly.…
Q: Diversified Semiconductors sells perishable electronic components. Some must be shipped and stored…
A: Journal entry -A journal entry is a method of recording transactions in the book of the original…
Q: High Country, Incorporated, produces and sells many recreational products. The company has just…
A: Income statement is a financial statement that shows profitability, total revenue and total…
Q: Sunburst Corporation's net revenues over a five year period were as follows (in millions of…
A: Lets understand the basics.Trend percentage is a percentage which shows trend of income or balance…
Q: Oriole Company uses a periodic inventory system and reports the following for the month of June.…
A: The first in first out is an inventory valuation method. Under this, the first purchases are sold…
Q: 45,000 performance fee to Wolfpack's previous owners. Prepare each of the following: Branson's entry…
A: ParticularsDebitCreditInvestment on Wolfpack $639,000Contingent performance…
Q: Estimate ending inventory in 2022 using the dollar-value LIFO retail method. (Round your…
A: LIFO (Last In- First Out) is a method of inventory valuation which records the most recently…
Q: Net assets fir celine, sole trader on 1 jan 2xx2 amounted to 128000. During the year to 31 december…
A: Three important elements of accounting equation are Assets, Liabilities and Equity. Equity includes…
Q: b. During 2022, Henry (a single taxpayer) has a salary of $85,000 and interest income of $4,000,…
A: The maximum contribution limit for an ESA (like a Coverdell Education Savings Account) is per year.…
Q: Problem 15-13 (Static) [LO 15-4] On September 30, 2017, Stalling, Incorporated issued 2,000 shares…
A: Taxable income is the amount of the person's income that is taxed after all the deductions and…
Q: Adrian contributed an antique vase he had owned for 25 years to a museum. At the time of the…
A: The objective of the question is to determine the amount Adrian can deduct from his taxes due to his…
Q: Raghu purchased a house in 2021 to use as a rental. What is his basis in the property if his…
A: The component basis in the property cost includes financing cost, taxes, insurance and…
Q: significa acteristic cant risk
A: Codification Reference-FASB ACS 305–10–20According to FASB in order to have any asset to be defined…
Q: Sell of Process Further Rose Hill, a soybean farm in northern Minnesota, has a herd of 50 dairy…
A: Revenue -Revenue, also called sales or the top line, is the amount of money that a business makes…
Q: What should be the carrying value of goodwill for reporting unit A at year - end? What should be the…
A: The objective of the question is to determine the carrying value of goodwill for reporting units A…
Q: Sweeten Company had no jobs in progress at the beginning of the year and no beginning inv completed,…
A: The pre-determined overhead rate is calculated as the estimated overhead costs divided by the…
Q: The following water and sewer fund information is available for the preparation of the financial…
A: An income statement is a financial report that indicates the revenue and expenses of a business. It…
Q: Poodle Corporation was organized on January 3, 2024. The firm was authorized to issue 96,000 shares…
A: The objective of the question is to calculate the total paid-in capital at the end of 2024 for…
Q: Would the research and development costs incurred by BMW for new and existing vehicle models be…
A: The research and development (R&D) costs incurred by BMW for new and existing vehicle models,…
Q: You work as an accountant for Pink Pony. Pink Pony had numerous active contracts at the beginning of…
A: Recognize Revenue for Goods Shipped in the Current Year (2022):Pink Pony recognizes revenue when…
Q: On June 30, 2021, Streeter Company reported the following account balances: Receivables Inventory…
A: Acquisition Cost 3,15,200.00Contingent Obligation Performance 23,700.00Total Obligation…
Q: Plant & Company plans to convert to IFRSs with a date of transition to IFRSs of 1 January 2X22.…
A: Solution:-The best response is: a. Plant & Company must recognize non-derivative financial…
Q: a. Total product cost a. Average cost per unit b. Cost of good sold c. Ending inventory d. Net…
A: Working note:Calculation of depreciation on manufacturing equipment:Depreciation = (cost - salvage…
Q: Yellowstone Company began operations on January 1 to produce a single product. It used an absorption…
A: Break Even means the volume of production or sales where there is no profit or loss. In other words,…
Q: 1. Compute the cost assigned to ending inventory using FIFO. 2. Compute the cost assigned to ending…
A: Inventory valuation is the process of assigning a monetary value to the goods and materials held by…
Q: The Eldorado Corporation's controller prepares adjusting entries only at the end of the reporting…
A: Journal entries are part of accounting use to record transaction in double entry accounting system…
Q: a. Matthew Young Co. sold $1,890,000 of 12%, 10-year bonds at 105 on January 1, 2025. The bonds were…
A: Since you have posted multiple questions, we can only provide the solution to the first question…
Q: Fill in the missing amounts in each of the eight case situations below. Each case is independent of…
A: CONTRIBUTION MARGIN - Contribution margin contributes towards fixed cost and profit. It is the…
Q: On October 29, Lobo Company began operations by purchasing razors for resale. The razors have a…
A: The "Estimated Warranty Liability" is a financial accounting term that refers to the amount a…
Q: Looney Corp. applies overhead on the basis of machine hours. For 2024, Looney estimated $866,000 of…
A: Predetermined Overhead Rate :— It is the rate used to allocate manufacturing overhead cost to cost…
![A study has been conducted to determine if Product A should be dropped. Total sales of
the product are $200,000 per year; total variable expenses are $140,000 per year. Total
fixed expenses charged to the product are $90,000 per year. The company estimates
that $40,000 of these fixed expenses will continue even if the product is dropped. These
data indicate that if Product A is dropped, the company's overall operating income per
year would change by how much?
O a. An increase of $30,000.
O b. An increase of $20,000.
Oc. A decrease of $10,000.
Od. A decrease of $20,000.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc6699015-b212-4ebb-812d-416f4a74ee5c%2Fa0068ddd-1d78-450a-95af-12852389ac69%2Flzdqmym_processed.jpeg&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Step by step
Solved in 3 steps with 1 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
- Patel Corporation is considering discontinuing one of its product lines. This product line generates a contribution margin of $330,000 per year. Fixed expenses allocated to the product line are $420,000 per year. It is estimated that $255,000 of these fixed expenses could be eliminated if the product line is discontinued. Based on this data, what is the financial advantage or disadvantage of discontinuing the product line? Multiple Choice Financial disadvantage of $75,000 per year. Financial advantage of $165,000 per year. Financial advantage of $75,000 per year.Zeal Corporation is thinking about the dropping of its product Z.Sales of the product total Rs.400,000 per year; variable expensestotal Rs. 270,000 per year. Fixed expenses charged to the producttotal Rs. 150,000 per year. The company estimates that Rs.70,000 of these fixed expenses are not avoidable even if theproduct is dropped. If Product Z is dropped, what will be the netincrease or decrease in profit of the company?A study has been conducted to determine if one of the departments in Your Company should be discontinued. The contribution margin in the department is $50,000 per year. Fixed expenses charged to the department are $65,000 per year. It is estimated that $40,000 of these fixed expenses could be eliminated if the department is discontinued. If the department is discontinued, what would be the annual change in the company's overall net operating? It the change is a decrease, enter your number with a – in front. Otherwise, just enter the number. ENTER YOUR ANSWER WITHOUT DOLLAR SIGNS OR OTHER DISCRIPTIONS.
- Last year Minden Company introduced a new product and sold 15,000 units at a price of $74 per unit. The product's variable expenses are S44 per unit and its fixed expenses are $521,400 per year. Required: What was this product's net operating income (loss) last year? What is the product's break-even point in unit sales and dollar sales? Assume the company conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g., S72, S70, etc.), what is the maximum annual profit it can earn on this product? What sales volume and selling price per unit generate the maximum profit? What would be the break-even point in unit sales and dollar sales using the selling price you calculated in requirement 37A study has been conducted to determine if one of the departments in Parry Company should be discontinued. The contribution margin in the department is $40,000 per year. Fixed expenses charged to the department are $65,000 per year. It is estimated that $30,000 of these fixed expenses could be eliminated if the department is discontinued. These data indicate that if the department is discontinued, the company's overall net operating income would: Oa. decrease by $15,000 per year. Ob. decrease by $10,000 per year. c. increase by $10,000 per year. Od. increase by $15,000 per year.Trebecker Construction plans to discontinue its roofing segment which last year generated a contribution margin of $65,000 and incurred $90,000 in fixed costs. If the segment is discontinued, half of the fixed costs will be avoided. What effect is expected to occur to the company’s overall profit? A decrease of $20,000 A decrease of $15,000 An increase of $15,000 An increase of $20,000 An increase of $30,000
- Company is thinking about the dropping of its product Z. Sales of the product total Rs.400,000 per year; variable expenses total Rs. 270,000 per year. Fixed expenses charged to the product total Rs. 150,000 per year. The company estimates that Rs. 70,000 of these fixed expenses are not avoidable even if the product is dropped. If Product Z is dropped, what will be the net increase or decrease in the profit of the company?A study has been conducted to determine if Product A should be dropped. Sales of the product total $500,000; variable expenses total $340,000. Fixed expenses charged to the product total $210,000. The company estimates that $60,000 of these fixed expenses are not avoidable even if the product is dropped. If Product A is dropped, the annual financial advantage (disadvantage) for the company of eliminating this product should be: Multiple Choice ($10,000) $10,000 ($50,000) $50,000 NextA study has been conducted to determine if Product A should be dropped. Sales of the product total $500,000; variable expenses total $340,000. Fixed expenses charged to the product total $210,000. The company estimates that $60,000 of these fixed expenses are not avoidable even if the product is dropped. If Product A is dropped, the annual financial advantage (disadvantage) for the company of eliminating this product should be: Multiple Choice ($10,000) $50,000 ($50,000) $10,000
- The Draper Company is considering dropping its Dream bug toy due to continuing losses. Revenue and cost data on the toy for the past year follow: Sales of 15,000 units P 150,000 Variable expenses 120,000 Contribution margin 30,000 Fixed expenses 40,000 Net operating loss (P 10,000) If the toy were discontinued, then Draper could avoid P8,000 per year in fixed costs. 1. Under the given conditions, the change in annual operating income from discontinuing the production and sale of Doombugs would be: 2. Assuming all other conditions stay the same, at what level of annual sales of Doombugs (in units) should Draper be indifferent to discontinuing Doombugs or continuing the production and sale of Doombugs? 3. Suppose that if the Doombug toy is dropped, the production and sale of other Draper toys would increase so as to generate a P16,000 increase in the contribution margin received from these…The Draper Company is considering dropping its Dream bug toy due to continuing losses. Revenue and cost data on the toy for the past year follow: Sales of 15,000 units P 150,000 Variable expenses 120,000 Contribution margin 30,000 Fixed expenses 40,000 Net operating loss (P 10,000) If the toy were discontinued, then Draper could avoid P8,000 per year in fixed costs. 1. Under the given conditions, the change in annual operating income from discontinuing the production and sale of Doombugs would be: A) P 30,000 decrease B) P 10,000 increase C) P 22,000 decrease D) P 18,000 increase 2. Assuming all other conditions stay the same, at what level of annual sales of Doombugs (in units) should Draper be indifferent to discontinuing Doombugs or continuing the production and sale of Doombugs? A) 20,000 B) 18,000 C) 6,000 D) 4,000…Blossom Footballs, Inc., management expects to sell 15,000 balls this year. The balls sell for $105 each and have a variable cost per unit of $71. Fixed costs, including depreciation and amortization, are currently $180,000 per year. How much can either the fixed costs or the variable cost per unit increase before the company has a negative EBIT. (Round increase in fixed cost to 0 decimal places, e.g. 5,275 and variable cost to 2 decimal places, e.g. 15.25.)Excel Template(Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem statement from this screen for easy reference to the values you’ve been given here, and be sure to update any values that may have been pre-entered in the template based on the textbook version of the problem.) Fixed costs could increase by $ and variable costs could increase by $ per unit
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)