Cotrone Beverages makes energy drinks in three flavors: Original, Strawberry, and Orange. Company is currently operating...

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Cotrone Beverages makes energy drinks in three flavors: Original, Strawberry, and Orange. Company is currently operating at 75 percent of capacity. Worried about the company's performance, the company president is considering dropping the Strawberry flavor. If Strawberry is dropped, the revenue associated with it would be lost and t related variable costs saved. In addition, the company's total fixed costs would be reduced by 15 percent. Segmented income statements appear as follows: Original $33,000 23,100 Strawberry $43,400 39,060 $ 4,340 Orange $51,100 40,880 Product Sales Variable costs Contribution margin Fixed costs allocated to each product line Operating profit (loss) $ 9,900 4,100 $ 5,800 Required: a. Prepare a differential cost schedule. Revenue Less: Variable costs Contribution margin Less: Fixed costs Operating profit (loss) Alternative: Status Quo Drop Difference (all lower under Strawberry the alternative) 6,100 $ (1,760) $10,220 7,400 $ 2,820 Cotrone Beverages makes energy drinks in three flavors: Original, Strawberry, and Orange. Company is currently operating at 75 percent of capacity. Worried about the company's performance, the company president is considering dropping the Strawberry flavor. If Strawberry is dropped, the revenue associated with it would be lost and t related variable costs saved. In addition, the company's total fixed costs would be reduced by 15 percent. Segmented income statements appear as follows: Original $33,000 23,100 Strawberry $43,400 39,060 $ 4,340 Orange $51,100 40,880 Product Sales Variable costs Contribution margin Fixed costs allocated to each product line Operating profit (loss) $ 9,900 4,100 $ 5,800 Required: a. Prepare a differential cost schedule. Revenue Less: Variable costs Contribution margin Less: Fixed costs Operating profit (loss) Alternative: Status Quo Drop Difference (all lower under Strawberry the alternative) 6,100 $ (1,760) $10,220 7,400 $ 2,820