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Sunland Company produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows: Wood Aluminum Hard Rubber Total Sales $530000 $250000 $65000 $845000 Variable expenses 280000 70000 58000 408000 Contribution margin 250000 180000 7000 437000 Fixed expenses 75000 35000 22000 132000 Net income (loss) $175000 $ 145000 $(15000) $305000 Assume none of the fixed expenses for the hard rubber line are avoidable. What will be total net income if the line is dropped?

Sunland Company produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows: Wood Aluminum Hard Rubber Total Sales $530000 $250000 $65000 $845000 Variable expenses 280000 70000 58000 408000 Contribution margin 250000 180000 7000 437000 Fixed expenses 75000 35000 22000 132000 Net income (loss) $175000 $ 145000 $(15000) $305000 Assume none of the fixed expenses for the hard rubber line are avoidable. What will be total net income if the line is dropped?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sunland Company produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows: Wood Aluminum Hard Rubber Total Sales $530000 $250000 $65000 $845000 Variable expenses 280000 70000 58000 408000 Contribution margin 250000 180000 7000 437000 Fixed expenses 75000 35000 22000 132000 Net income (loss) $175000 $ 145000 $(15000) $305000 Assume none of the fixed expenses for the hard rubber line are avoidable. What will be total net income if the line is dropped?
Transcribed Image Text:Sunland Company produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows: Wood Aluminum Hard Rubber Total Sales $530000 $250000 $65000 $845000 Variable expenses 280000 70000 58000 408000 Contribution margin 250000 180000 7000 437000 Fixed expenses 75000 35000 22000 132000 Net income (loss) $175000 $ 145000 $(15000) $305000 Assume none of the fixed expenses for the hard rubber line are avoidable. What will be total net income if the line is dropped?
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