Exercise 10-8 Income analysis of eliminating departments LO P4 Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe segment and is considering dropping that product line. The following information is available regarding its canoe segment. eBook $2,000, eee MARINETTE COMPANY Income Statement-Canoe Segment Sales Variable costs Direct materials $ Direct labor Variable overhead Variable selling and administrative Total variable costs Contribution margin Fixed costs Direct Indirect Total fixed costs Net income 450,000 500.000 300.000 200,000 1.450.000 550.000 Derences 375,000 300,000 $(125.000) 1. If canoes are discontinued, calculate the net income lost or gained 2. Should management discontinue the manufacturing of cances? Complete this question by entering your answers in the tabs below Required 1 Required 2 If canoes are discontinued, calculate the net income lost or gained. (Leave no cells blank. Enter zeros where ap Keep the department $ 2,000,000 Eliminate the department Sales Expenses Total expenses Net income (loss) 2,000,000 $ The canoe division should be If the canoe division is eliminated. Income will be 1. If canoes are discontinued, calculate the net income lost or gained. 2. Should management discontinue the manufacturing of canoes? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Should management discontinue the manufacturing of canoes? Should management discontinue the manufacturing of canoes? |