Dropping Unprofitable Segments

CAPNOS

Line of Business Statement

For the Year Ended December $31,2022$

Orange Mint Lavender Total

Revenues $$135,000$ $$125,000$ $$145,000$ $$405,000$

Cost of goods sold $100,000100,000137,000337,000$

Gross Profit $$35,000$ $$25,000$ $$8,000$ $$68,000$

Traceable labor $15,00010,0008,00033,000$

Traceable direct expenses $8,0007,5005,00020,500$

Common expenses $4,7504,5005,00014,250$

Operating Income $$7,250$ $$3,000($$$10,000)$ $$250$

Question $15(1$ point$)$

Should CAPNOS drop production of the Lavender Cap Pack?

Question $15$ options:

Yes

No