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Exercise 23-8 Income analysis of eliminating departments LO P4 Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe

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Exercise 23-8 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 MARINETTE COMPANY Income Statement-Cance Segment Sales $4,000,000 Variable costs Direct materiais $ 850,000 Direct Labor 900.000 Variable overhead 700,000 Variable selling and administrative 400.000 Total variable costs 2,850,000 Contribution margin 1,150,000 Fixed costa Direct 775,000 Indirect 700,000 Total fixed costs 1,475,000 Net Income (325,000) 1. If cances 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 It cances are discontinued, calculate the net income lost or gained. (Leave no cells blank. Enter zeros where appropriate.) Keep the department $ 4.000.000 Eliminate the department 4. Should management UISCOnunue me malluidCunny or Cannes! 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. Ent Keep the department $ 4,000,000 Eliminate the department Sales Expenses: Direct materials Direct labor Total expenses Net income (loss) $ 4,000,000 $ 0 The cance division should be If the cance division is eliminated, income will be Required 1 Required 2 >

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