7:08 education.wiley.com - Assignment 4 - Chapter 7 2 of 2 - / 10 View Policies Current Attempt in Progress Clarington Company makes three models of phasers. Information on the three products is given below: Stunner D Sales $ 301,000 $ 4 Variable expenses 149,000 Contribution margin 152,000 2 Fixed expenses 114,000 2 Net income $ 38,000 Fixed expenses consist of $ 294,500 of common costs allocated to the three products based on relative sales, and + 29 . . .7:08 . '5' C} a educationwileycom 6 Assignment 4 - Chapter 7 20f2 -/10 E Fixed expenses consist of $ 294,500 of common costs allocated to the three products based on relative sales, and additional xed expenses of $ 29,500 (Stunner), $ 74,500 (DoubleSet), and $ 29,700 (Mega-Power). The common costs will be incurred regardless of how many models are produced. The other xed expenses would be eliminated if a model is discontinued. John Liu, an executive with the company, feels the Mega-Power line should be discontinued to increase the company's net income. Calculate current net income for Clarington Company. Current net income $ eTextbook and Media 7:08 .- '5" {E} a education.wiley.com 6 Assignment 4 - Chapter 7 20f2 -/10 E Current net income $ eTextbook and Media Question Part Score --/2 Calculate net income by product line and in total for Clarington Company if the company discontinues the Mega- Power product line. (Hint: Allocate the $ 294,500 common costs to the two remaining product lines based on their relative sales.) Net income 7:08 education.wiley.com Assignment 4 - Chapter 7 2 of 2 - /10 E 294,500 common costs to the two remaining product lines based on their relative sales.) Stunner Net income tA e Textbook and Media Question Part Score --/6 Should Clarington eliminate the Mega- Power product line? Why or why not? Clarington V elim Teytho K and Media7:08 education.wiley.com Assignment 4 - Chapter 7 2 of 2 - /10 WN - E Question Part Score --/6 Should Clarington eliminate the Mega- Power product line? Why or why not? Clarington V elim eTextbook and Media Question Part Score --/2 Save for Later Attempts: 0 of 3 used Submit