Differential Analysis for a Discontinued Product

A condensed income statement by product line for Lavonia Beverage Inc. indicated the following for Vim Cola for the past year:

Sales

Cost of goods sold

Gross profit

Operating expenses

Operating loss

$[$$$12,500,000],[(10,000,000)],[$$$2,500,000],[(3,500,000)],[$$$(1,000,000)]$

affected if the product is discontinued.

loss.

Differential Analysis

Continue $($Alt$.1)$ or Discontinue $($Alt$.2)$ Vim Cola

November $2$

b$.$ Should Vim Cola be retained?