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Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe segment and is considering dropping that product line. The
Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe segment and is considering dropping that product line. The following information is available regarding its canoe segment. $2,700,000 MARINETTE COMPANY Income Statement-Canoe Segment Sales Variable costs Direct materials $ 590,000 Direct labor 640,000 Variable overhead 440,000 Variable selling and administrative 270,000 Total variable costs Contribution margin Fixed costs Direct 515,000 Indirect 440,000 Total fixed costs Net income 1,940,000 760, 000 955,000 $ (195, 000) 1. If canoes are discontinued, calculate the net income lost or gained. 2. Should management discontinue the manufacturing of canoes? Required 1 Required 2 If canoes are discontinued, calculate the net income lost or gained. (Leave no cells blank. Ente Keep the department Eliminate the department Sales Expenses: Total expenses Net income (loss) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Should management discontinue the manufacturing of canoes? Should management discontinue the manufacturing of canoes?
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