Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I need help getting the Wood flooring contribution margin lost if laminate flooring product line is dropped and the op erating income gained if

image text in transcribedimage text in transcribed

I need help getting the "Wood flooring contribution margin lost if laminate flooring product line is dropped" and the "operating income

gained if laminate flooring is dropped" on the last part of the problem

image text in transcribedimage text in transcribed
Hhede Island Fleering Product Line Gentributien Hargin Income Statement Fur the Year Product line: Wand fleering Laminate ooring Cul'rlpany Tetal Sales revenue $ S $ 'i $ 441.001} Lesa: Variable almanaee 155.539 w w Centrihuen margin 149.0[10 $ 4B,L'IDD $ 19?, Lesa xed almanaee: Manufacturing ?4,DDD E1 .000 135,000 Marketing and administrative 5mm 13,030! ?, mane $ {aspen} $ {3,000} Opereng income [less] I'l._'_J. n _ _ _ Heal} the @mremenzs. Decision; Do not drop the laminate oa'ing product the because. assuming 530.000 afxed expenses attributable to the laminate flooring product line can be avoided. the loss ofcontribution margin will still need the xed cost saving. Requirement. 3. Now, assume that all of the xed costs assigned to laminate ooring are direct xed masts and can be avoided ilthe company stops salling laminate flooring. However. marketing has concluded thatwocd flooring sal would be adversely affected bydiscontinuing thl laminate flooring line (retailers want to buy both from the same supplier). Wood flooring production and sal would dedine 10%. What should the company do? Prepare an incremental analysis. (Enters '0' in an input box if there is no expected change as a result of discontinuing the laminate ooring line in this scenario.) Incremental Analysis for Discontinuation Decision Total Laminate tlooring contribution margin lost if laminate ooring product line is dropped $ 43.990 Wood ooring contribution margin lost if laminate ooring product line is dropped 18000 14,000 Less: Fixed cost savings if laminate flooring product line is dropped Operating income gained it laminate flooring is dropped Choose from any list or enter any number in the input elds and then click Check

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial and Managerial Accounting

Authors: John J Wild, Ken W. Shaw

8th edition

1260247856, 978-1260247855

More Books

Students also viewed these Accounting questions

Question

Describe why listening is important to customer service.

Answered: 1 week ago