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It is estimated that 20% of the cost of goods sold represents fixed factory overhead costs and that 30% of the operating expenses are fixed.

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It is estimated that 20% of the cost of goods sold represents fixed factory overhead costs and that 30% of the operating expenses are fixed. Because Star Cola is oniy one of many products, the fixed costs will not be materially affected if the product is discontinved. a. Prepare a differential analysis dated Janiary 21 to determine whether to Continue Star Cola (Alternative 1 ) or Discentinue Star Cola (Aitemative 2 ). If an amount is zero, enter zero " 0, For those boxes in which you must enter subtracted or negative numbers use a minus sign. b. Should Star Cola be retained? Explain. As indicated by the differential analysis in part (a), the income would by $ if the product is discontinued. Festhask F Check ty won For continue and discontinue altematives subtract the costs from the revenue. Use percentages to separate variable from foved costs. Determine the differential effect on income of the revenues, costs, and income (loss) by subtracting alternateve 2 from aiternative 1. 2 moes Check My Work uses remainno

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