Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Cawley Company makes three models of tasers. Information on the three products is given below TinglerShocker Stunner $304,800 $501,100 $199,000 Sales Variable expenses 151,000 207,800

image text in transcribed
Cawley Company makes three models of tasers. Information on the three products is given below TinglerShocker Stunner $304,800 $501,100 $199,000 Sales Variable expenses 151,000 207,800 138,000 Contribution margin 153,800 293,300 61,000 Fixed expenses 123,230 232,437 95,733 $30,570 $60,863 $(34,733) Net income Fixed expenses consist of $307,700 of common costs allocated to the three products based on relative sales, and additional fixed expenses of $29,900 (Tingler), $79,000 (Shocker), and $34,800 (Stunner). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. James Watt, an executive with the company, feels the Stunner line should be discontinued to increase the company's net income. Compute current net income for Cawley Company. Net income Compute net income by product line and in total for Cawley Company if the company discontinues the Stunner product line. (Hint: Allocate the $307,700 common costs to the two remaining product lines based on their relative sales.) (Round answers to the nearest whole dollar, e.g. 5,275.) Tingler Net Income Shocker Net Income Total Net Income s

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

Step: 3

blur-text-image

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

The Leadership Style At PT Tekstil Bandung A Management Audit Investigation Following The Prolonged Economic Slowdown In Indonesia

Authors: Samuel P.D. Anantadjaya, Irma M. Nawangwulan

1st Edition

3659328979, 978-3659328978

More Books

Students also viewed these Accounting questions

Question

describe the main employment rights as stated in the law

Answered: 1 week ago