rr The management of Wenger Corporation is considering dropping product 090D, Data from the company's accounting system appearbelow:SalesVariable expensesFixed manufacturing expensesFixed setting and administrative expensesAll fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation hasrevealed that $192,000 of the fixed manufacturing expenses and $166.400 of the fixed selling and administrative expenses areavoidable if product B90D is discontinued.$ 798,000$415,100.$ 271,600$ 231,800Required:What would be the financial advantage (disadvantage) of dropping B90D? Should the product be dropped?if product B00D were dropped. Therefore, the productNet operating income (loss) wouldby

The dropping of order decreases income because of contribution margin loss. In the case of dropping…

low Sales ariable expenses ixed manufacturing expenses ixed setting and administrative expenses xed expenses of the company are fully allocated to pa aled that $192,000 of the fixed manufacturing expens table if product 090D is discontinued. ired:

low Sales ariable expenses ixed manufacturing expenses ixed setting and administrative expenses xed expenses of the company are fully allocated to pa aled that $192,000 of the fixed manufacturing expens table if product 090D is discontinued. ired:

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 4E: Differential analysis for a discontinued product The condensed product-line income statement for...

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The management of Wengel Corporation is considering dropping product B90D. Data from the company's accounting system appear below: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $179,000 of the fixed manufacturing expenses and $155,200 of the fixed selling and administrative expenses are avoidable if product B90D is discontinued. Required: What would be the financial advantage (disadvantage) of dropping B90D? Should the product be dropped? Net operating income (loss) would $ 745,000 $ 387,000 $ 253,400 $216,200 decline increase by if product B90D were dropped. Therefore, the product dropped
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The management of Wengel Corporation is considering dropping product B90D. Data from the company's accounting system appear below: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses $803, 200 $417,300 $273,000 $233,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $193,000 of the fixed manufacturing expenses and $167,300 of the fixed selling and administrative expenses are avoidable if product B90D is discontinued. Required: 1. What would be the financial advantage (disadvantage) of dropping B90D? 米 2. Should B90D be dropped? O Yes O No
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