Differential Analysis for a Discontinued Product A condensed income statement by product line for Healthy Beverage Inc. indicated the following for Fruit Cola for the past year: Sales Cost of goods sold Gross proft Operating expenses Loss from operations 12,750,000 8,500,000 4,250,000 6,000,000 (1,750,000) It is estimated that 25% of the cost of goods sold represents fixed factory overhead costs and that 15% of the Because Fruit Cola is only one of many products, the fixed costs will not be materially affected if che product is ds operating expenses are fixed. a differential analysis dated January 5 to determine whether Fruit Cola should be continued (Alternative 1) or discontinued (iternative 2). If an amount is zero, enter "O". Use a minus sign to indicate a loss Differential Analysis Continue Fruit Cola (Alt. 1) or Discontinue Fruit Cola (Ait. 2) Contnue Fruit Cola (Aternative 1) Discortinue Fruit Cola (atemative 2) offerential efect on Income (Ateracive 2) Revenues Costs: Variable cost of goods sold Next Previous 2 more Check My Work uses remaining Check My Work perating expenses Loss from operations (1,750,000) It is estimated that 25% of the cost of goods sold represents fixed factory overhead costs and that 15% of the operating expenses are fixed. Because Fruit Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued a. Prepare a differential analysis dated January 5 to determine whether Fruit Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". Use a minus sign to indicate a loss. Differential Analysis Continue Fruit Cola (Alt. 1) or Discontinue Fruit Cola (Alt. 2) anuary 5 Continue Fruit Cola (Alternative 1) Discontinue Frut Cola (Alternative 2) Differential Efect on Income (Aternative 2) Revenues Costs: Variable cost of goods sold Variable operating expenses Fixed costs Income (Loss) b. Should Fruit Cola be retained? PreviousNext Check My Work 2 more Check My Work uses remaining