Chip Company produces three products, Kin, Ike, and Bix. Each product uses the same direct material. Kin uses $4\mathrm{.}2$ pounds of theMarin Company makes several products, including canoes. The company reports a loss from its canoe segment $($see below$).$ All its

variable costs are avoidable, and $$322,500$ of its fixed costs are avoidable.

$($a$)$ Compute the income increase or decrease from eliminating this segment.

$($b$)$ Should the segment be continued or eliminated?

Complete this question by entering your answers in the tabs below.

Compute the income increase or decrease from eliminating this segment.

material, Ike uses $3\mathrm{.}8$ pounds of the material, and Bix uses $5\mathrm{.}9$ pounds of the material. Selling price per unit and variable costs per unit

of each product follow.

$($a$)$ Compute contribution margin per pound of material for each product.

$($b$)$ If demand is limited$,$ list the three products in the order in which management should produce and meet demand.