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Crane Company has three product lines in its retail stores: books, videos, and music. The allocated fixed costs are based on units sold and are
Crane Company has three product lines in its retail stores: books, videos, and music. The allocated fixed costs are based on units sold and are unavoidable. Demand of individual products is not affected by changes in other product lines. Results of the fourth quarter are. presented below: Units sold Revenue Variable departmental costs Direct fixed costs Allocated fixed costs Net income (loss) Books 1,040 $24,960 15,600 3,120 4,576 $1,664 Music 2,080 $49,920 22,880 6,240
Crane Company has three product lines in its retall stores: books, videos, and music. The allocated fixed costs are based on units sold and are unavoidable. Demand of individual products is not affected by changes in other product lines. Results of the fourth quarter are . presented below: Prepare an incremental analysis of the effect of dropping the Video product line. (Enter negative amounts using elther a negative sign preceding the number eg -45 or parentheses eg. (45).)Step by Step Solution
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