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Income Statement Cance Seqment Sales $2,000,000 Variable costs Direct materials $450,000 Direct labor 500.000 Variable overhead 300,000 Variable selling and 200,000 administrative Total variable costs

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Income Statement Cance Seqment Sales $2,000,000 Variable costs Direct materials $450,000 Direct labor 500.000 Variable overhead 300,000 Variable selling and 200,000 administrative Total variable costs 1.450.000 Contribution margin 550,000 Fixed costs Direct 375,000 Indirect 300,000 Total fixed costs 675.000 Set income $125,000) 1. If canoes are discontinued, calculate the net income lost or gained 2. Should management discontinue the manufacturing of canoes? X Answer is not complete. Complete this question by entering your answers in the tabs below. Required Required If canoes are discontinued, calculate the net income lost or gained. (Leave no cells blank. Enter zeros where appropriate.) Keep the department Eliminate the department $ 2,000,000 Sales Expenses: Direct materials Direct labor Variable overhead Variable selling and administrative costs 450,000 500,000 300,000 200,000 Direct fxed costs Indirect fixed costs Total expenses Net Income loss) -- 375,000 300.000 2,125,000 (125.000) 300.000 300,000 S (300.000) S The canoe division should be: If the canoe division is eliminated income will be Kept lower by: $ 175,000 Required Required 2 >

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