A value-driven car manufacturer, Nash, started its business more than 50 years ago, making and selling a sedan body style. Sedans were popular at the time, and this one drove the success of Nash for years due to its practical yet stylish nature. As times changed, Nash designed models in different body styles, and those models have outpaced sedans, as follows.

Nash believes it can save $612,000 in fixed costs associated with the sedans if it drops that vehicle category. Should the company seriously consider dropping it? How much better or worse off, financially, would it be by dropping the sedan?

Nash would be better off v by$

102000

Assume that 75% of the fixed costs shown in the original information, for all product lines, are direct fixed costs. The remaining fixed costs are common fixed costs, allocated to the product lines according to their sales volumes. Recast the product-line income statements detailing the direct and allocated fixed costs for each, including a subtotal for segment margin and an overall total column. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Question 2 of 2 3.33/10 = Nahh would be tetier of io by 150000 tTextbook and Media Artenves 1 ef 3 uned (c) elintboch and Medis A value-drhen car manudacture, Nash, started its business more than 50 vears aga making and selling a sedan body style, 5 edans were popular at the time, and this one drove the success of Nash for years due to its practicaf yet stylish nature. As timeschunged. Nash designed models in different body styles, and those models have outpaced sedans, as follows. The income statements above reflect the second consecutive year the sedan category has last money. Nash is concerned about dropoing this vehicle, however, since the company's success was originally built on it. (a) Your answer is comect. Nash believes it can save $612,000 in fund costs associated with the sedans if it drops that vehicle categony. Should the compary seriousty consider dropoing ie? How much better or worse ott, financlally, would it be by dropping the sedan? Nash would be fued costs are common fued costs a liocated to the product Ines according to their sales volumes Recast the product lise incane stalements detaling the direct and allocabed fixed conts for exch includise a ubetal for sepnent marbin and an onerall total