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Additional Brief Exercise 176 Keith Inc. has 4 product lines: sour cream, ice cream, yogurt, and butter. Demand of individual products is not affected by
Additional Brief Exercise 176 Keith Inc. has 4 product lines: sour cream, ice cream, yogurt, and butter. Demand of individual products is not affected by changes in other product lines. 30% of the fixed costs are direct, and the other 70% are allocated. Results of June follow: Units sold Revenue Variable departmental costs Fixed costs Net income (loss) Sour Cream 2,000 $ 10,000 6,000 5,000 $ (1,000) Ice Cream 500 $ 20,000 13,000 2,000 $ 5,000 Yogurt 400 $10,000 4,200 3,000 $ 2,800 Butter 200 $ 20,000 4,800 7,000 $ 8,200 Total 3,100 $60,000 28,000 17,000 $15.000 Prepare an incremental analysis of the effect of dropping the sour cream product line. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
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