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Sales. Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether o the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear ou Required 1 Required 2 Required 3 Total $ 922,000 459,000 463,000 Complete this question by entering your answers in the tabs below. Sales Variable manufacturing and selling expenses Contribution margin (loss) Traceable fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of the product line managers 69,900 43,600 114,300 184,400 412, 200 $ 50,800 Total traceable fixed expenses Product line segment margin (loss) Common fixed expenses Net operating income (loss) $ Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-r profitability of the various product lines. Totals 0 Dirt Bikes Bikes $ 266,000 $ 402,000 113,000 193,000 153,000 209,000 Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. 0 0 0 8,800 20,300 40,800 53,200 123, 100 $ 29,900 $ Dirt Bikes 0 40,500 7,900 0 0 20,600 15,400 35,100 50,800 121,900 $ 41,800 $ (20,900) 38,400 80,400 167,200 $ Racing Bikes $ 254,000 153,000 101,000 Mountain Bikes Racing Bikes 0 0 0 $ 0 0

Sales. Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether o the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear ou Required 1 Required 2 Required 3 Total $ 922,000 459,000 463,000 Complete this question by entering your answers in the tabs below. Sales Variable manufacturing and selling expenses Contribution margin (loss) Traceable fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of the product line managers 69,900 43,600 114,300 184,400 412, 200 $ 50,800 Total traceable fixed expenses Product line segment margin (loss) Common fixed expenses Net operating income (loss) $ Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-r profitability of the various product lines. Totals 0 Dirt Bikes Bikes $ 266,000 $ 402,000 113,000 193,000 153,000 209,000 Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. 0 0 0 8,800 20,300 40,800 53,200 123, 100 $ 29,900 $ Dirt Bikes 0 40,500 7,900 0 0 20,600 15,400 35,100 50,800 121,900 $ 41,800 $ (20,900) 38,400 80,400 167,200 $ Racing Bikes $ 254,000 153,000 101,000 Mountain Bikes Racing Bikes 0 0 0 $ 0 0

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter9: Responsibility Accounting And Decentralization
Section: Chapter Questions
Problem 6PA: Using the information from BDS Enterprises, prepare the income statement to include all costs, but...
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Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Sales Variable manufacturing and selling expenses Contribution margin (loss) Total $ 922,000 459,000 463,000 Traceable fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of the product line managers 69,900 43,600 114,300 184,400 412, 200 $ 50,800 *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or no the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Total traceable fixed expenses Product line segment margin (loss) Common fixed expenses Net operating income (loss) $ Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Totals 0 Dirt Bikes Bikes $ 266,000 $ 402,000 193,000 113,000 153,000 209,000 8,800 20,300 40,800 53,200 123, 100 0 0 $ 0 40,500 20,600 7,900 15,400 38,400 35, 100 80,400 50,800 167,200 121,900 $ 29,900 $ 41,800 $ (20,900) Dirt Bikes 0 0 0 Racing Bikes $ 254,000 153,000 101,000 Mountain Bikes $ 0 Racing Bikes 0 0 $ 0 0 0
Transcribed Image Text:Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Sales Variable manufacturing and selling expenses Contribution margin (loss) Total $ 922,000 459,000 463,000 Traceable fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of the product line managers 69,900 43,600 114,300 184,400 412, 200 $ 50,800 *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or no the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Total traceable fixed expenses Product line segment margin (loss) Common fixed expenses Net operating income (loss) $ Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Totals 0 Dirt Bikes Bikes $ 266,000 $ 402,000 193,000 113,000 153,000 209,000 8,800 20,300 40,800 53,200 123, 100 0 0 $ 0 40,500 20,600 7,900 15,400 38,400 35, 100 80,400 50,800 167,200 121,900 $ 29,900 $ 41,800 $ (20,900) Dirt Bikes 0 0 0 Racing Bikes $ 254,000 153,000 101,000 Mountain Bikes $ 0 Racing Bikes 0 0 $ 0 0 0
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ISBN:
9781947172609
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OpenStax College
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