Question
Bake Inc. produces and sells 29,200 units of Sheet Pans each month. The selling price of Sheet Pans is $14 per unit, and variable expenses
Bake Inc. produces and sells 29,200 units of Sheet Pans each month. The selling price of Sheet Pans is $14 per unit, and variable expenses are $11 per unit. A study has been made concerning whether Sheet Pans should be discontinued. The study shows that $100,000 of the $150,500 in monthly fixed expenses charged to Sheet Pans would not be avoidable even if the product was discontinued. If Sheet Pans are discontinued, the monthly financial advantage (disadvantage) for the company of eliminating this product should be:
($62,900)
($100,000)
$62,900
($37,100)
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