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Decision to Discontinue a Product On the basis of the following data, the general manager of Featherweight Shoes Inc. decided to discontinue Children's Shoes because

Decision to Discontinue a Product

On the basis of the following data, the general manager of Featherweight Shoes Inc. decided to discontinue Children's Shoes because it reduced income from operations by $17,000.

Featherweight Shoes Inc. Product-Line Income Statement For the Year Ended April 30, 2016
Children's Shoes Men's Shoes Women's Shoes Total
Sales $235,000 $300,000 $500,000 $1,035,000
Costs of goods sold:
Variable costs $130,000 $150,000 $220,000 $500,000
Fixed costs 41,000 60,000 120,000 221,000
Total cost of goods sold $171,000 $210,000 $340,000 $721,000
Gross profit $64,000 $90,000 $160,000 $314,000
Selling and adminstrative expenses:
Variable selling and admin. expenses $46,000 $45,000 $95,000 $186,000
Fixed selling and admin. expenses 35,000 20,000 25,000 80,000
Total selling and admin. expenses $81,000 $65,000 $120,000 $266,000
Income (loss) from operations $(17,000) $25,000 $40,000 $48,000

If the children Shoe's are discontinued, the company's would by $.

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