Current Attempt in Progress

Carla Vista Equipment sells equipment to sports enthusiasts. Doug Carla Vista, the company's president, just received the following income statement reporting the results of the past year.

Baseball

Soccer

Basketball

Total

Sales revenue

$$1,330,000$

$$3,810,000$

$$2,503\mathrm{.}000$

$$7,643,000$

Variable cost of goods sold

$898,000$

$2,476\mathrm{.}500$

$2,017,600$

$5,392,100$

Fixed cost of goods sold

$121,100$

$197,700$

$174\mathrm{.}100$

$492\mathrm{.}900$

Gross profit

$310,900$

$1,135,800$

$311\mathrm{.}300$

$1,758,000$

Variable operating expenses

$179,600$

$609,600$

$250\mathrm{.}300$

$1,039,500$

Fixed operating expenses

$83,400$

$88,900$

$77,100$

$249,400$

Common fixed costs

$63,500$

Operating income

$($$$15,600)$

$136,000$

$$301,300$

$102,500$

$302,000$

$($$$118,600)$

$$167,100$

Doug is concerned that two of the company's divisions are showing a loss, and he wonders if the company should stop selling baseball and basketball gear to concentrate solely on soccer gear.