Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bubblemanis has three product lines - A, B, and C. A B C Total Sales $10,000 $9,000 $12,000 $31,000 Variable costs 4,500 7,000 6,000 17,500

Bubblemanis has three product lines - A, B, and C.

A B C Total
Sales $10,000 $9,000 $12,000 $31,000
Variable costs 4,500 7,000 6,000 17,500
Contribution margin 5,500 2,000 6,000 13,500
Fixed costs 3,500 6,000 3,000 12,500
Net income 2,000 (4,000) 3,000

1,000

Product line B appears unprofitable, and management is considering discontinuing the line. How would the discontinuation of Product line B affect net income?

Select one:

a. increase by $2,000

b. decrease by $2,000

c. decrease by $4,000

d. increase by $4,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

3 Column Record 100 Page Account Book

Authors: IJ Publishing LLC

Ntb Edition

1537091360, 978-1537091365

More Books

Students also viewed these Accounting questions

Question

6. Explain what causes unsafe acts.

Answered: 1 week ago