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I got 27200 as my answer but I dont think its right ABC Company sells three products. Income statements for the three products for the
I got 27200 as my answer but I dont think its right
ABC Company sells three products. Income statements for the three products for the most recent year appear below: Product A Product B Product C $210,000 $250,000 $285,000 Sales revenue Costs: Variable costs Advertising Rent Supervisor's salary Property taxes Net income/loss 147,000 25,000 5,000 41,000 7,000 75,000 31,000 5,000 48,000 16,000 75,000 171,000 32,000 5,000 50,000 12,000 15,000 The rent is allocated to the three products equally and the property taxes are allocated based on the square footage each product uses in the factory. The president of the company is considering eliminating Product A. The company has determined that if Product A is discontinued, the contribution margin of its other products will increase by $22,000. Calculate the amount by which the company's net income will increase if Product A is droppedStep by Step Solution
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