Refer to the information for Petoskey Company above. Assume that, each of the three products has a different supervisor whose position would be eliminated if the associated product were dropped.
Petoskey Company produces three products: Alanson, Boyne, and Conway. A segmented income statement, with amounts given in thousands, follows:

Required:
Estimate the impact on profit that would result from dropping Conway. Explain why Petoskey should keep or drop Conway.

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Alanson Boyne Conay Total Sales revenue Less: Variable expenses Contribution margin Less: Direct fixed expenses: 1,280 185 $300 1765 (1.115)45(2251385) $ 165 $140 75 380 Depreciatorn Salaries (50 (15) 5 (85) 20 $ 40 (75) 260 (10) Segment margin 115