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Calculator Wool Yarn Total Company Raw Wool Rug Yarn $155,000 Sales $200,000 $187,000 $542,000 Costs of goods sold: Variable costs $(48,000) $(18,600) $(37,170) $(103,770) Fixed
Calculator Wool Yarn Total Company Raw Wool Rug Yarn $155,000 Sales $200,000 $187,000 $542,000 Costs of goods sold: Variable costs $(48,000) $(18,600) $(37,170) $(103,770) Fixed costs (32,000) (12,400) (24,780) (69,180) Total cost of goods sold $(80,000) $(31,000) $(61,950) $(172,950) Gross profit $120,000 $124,000 $125,050 $369,050 Operating expenses: Variable expenses $(5,000) $(7,750) $(53,130) (65,880) Fixed expenses (89,000) (77,000) (106,200) (272,200) Total operating expenses $(159,330) $(94,000) $(84,750) $(338,080) Operating income (loss) $26,000 $39,250 $(34,280) $30,970 Complete the following table using the data in the preceding income statement to compare the effects of dropping the rug yarn line of products. If required, use es to indicate a loss. Differential Analysis Continue Rug Yan (Alternative 1) or Discontinue Rug Yarn (Alternative 2) December 31, 20Y8 Continue Rug Yarn (Alternative 1) Discontinue Rug Yarn (Alternative 2) Differential Effects (Alternative 2) Revenues 187,000 Costs: Variable Fixed Profit (loss) Foedback Check My Work
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