Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
BlossomIndustries manufactures light fixtures for home, retail, and industrial customers. The retail line has been showing losses for several years, and management is considering dropping
BlossomIndustries manufactures light fixtures for home, retail, and industrial customers. The retail line has been showing losses for several years, and management is considering dropping the line. Recent income statements have been very similar to the following information which was prepared for the most recent year: Home Retail Industrial Total Sales $552300 $322300 $832300 $1706900 Variable costs 359500 220000 683000 1262500 192800 102300 149300 444400 Contribution margin Fixed costs 127300 132300 117300 376900 Operating income $65500 $(30000) $32000 $67500 of the fixed costs, $321900 of it is common costs that have been allocated equally to each product line. What will total operating income be if Blossom drops the retail line? $(9800) $77300 O$97500 O $20200
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started