Keep$-$or$-$Drop Decision

Charlevoix Company produces three products: Torch, Elk, and Walloon. A segmented income statement follows:

Sales revenue

Less: Variable expenses

Contribution margin

Less direct fixed expenses:

Depreciation

Advertising

Segment margin

Segment margin

Assume that each of the three products has a different marketing campaign whose advertising would be eliminated if the associated product were dropped.

Required:

$

Conceptual Connection: Should Charlevoix keep or drop Walloon?

advertising cost. $[$Refer to Exhibit $2\mathrm{.}2]$

The empirical study of past advertising cost represents an example of a

data analytic.