Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Trap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution margin $26,000 $29,000 $ 4,000 $ 59,000 Less: Direct fixed costs 1,900 2,500 2,000 6,400 Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Common fixed costs. 17,840 17,840 8,920 44,600 Net operating $ 6,260 income (loss) 8,000 $ 8,660 $16,920) $ "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp.drops the Azul line. 1-6. Will Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production Information and the entire $51,000 of fixed cost was common fixed cost. 3-b. Should Mohave drop the Azul model? 3. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Reg 2 Reg 3A Req 3B Reg 3C Complete the table given below, assuming Mohave Corp. drops the Azul line. (Do not round intermediate calculations. Round Common Fixed Costs to the nearest whole dollar.) Indigo Verde Total Sales Revenue Variable Costs Contribution Margin Direct Fixed Costs Segment Margin Common Fixed Costs Net Operating Income (Loss) Reg 1A Req 1B > Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Trap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution $26,000 $29,000 $ 4,000 margin $ 59,000 Less: Direct 1,900 fixed costs 2,500 2,000 6,400 Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Common fixed 17,840 17,840 8,920 44,600 costs Net operating income (losa) $ 6,260 $ 8,660 $16,920) $ 8,000 "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp. drops the Azul line. 1-6. Wil Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production Information and the entire $51,000 of fixed cost was common fixed cost. 3-6. Should Mohave drop the Azul model? 3-c. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Reg 2 Reg 3A Reg 38 Reg 3C Will Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? Change in Net Operating Income (Loss) Req 1A Reg 2 > Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's Information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Frap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution $26,000 $29,000 margin $ 4,000 $ 59,000 Less: Direct fixed costs 1,900 2,500 2,000 6,400 Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Common fixed 17,840 17,840 8,920 44,600 costo Net operating $ 6,260 $ 8,660 $(6,920) $ 8,000 income (losa) "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp. drops the Azul line. 1-b. Will Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production Information and the entire $51,000 of fixed cost was common fixed cost. 3-b. Should Mohave drop the Azul model? 3-c. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Reg 38 Req 30 Reg 1A Reg 1B Reg 2 Reg 3A Should Mohave drop the Azul model? Yes ONO Req 1B Reg 3A > Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Trap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution $ 26,000 $29,000 $ 4,000 $ 59,000 margin Less: Direct 1,900 2,500 2,000 6,400 fixed costs Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Common fixed 17,840 17,840 8,920 costs 44,600 Net operating $ 6,260 8,000 income (loss) $ 8,660 $16,920) $ "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp. drops the Azul line. 1-b. Will Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production information and the entire $51,000 of fixed cost was common fixed cost. 3-b. Should Mohave drop the Azul model? 3-c. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Req1A Req 1B Reg 2 Reg 3A Req 3B Reg 30 Complete the table given below assuming that Mohave had no direct fixed overhead in its production information and the entire $51,000 of fixed cost was common fixed cost. Change in Contribution Margin Contribution Margin Gained on Indigo Contribution Margin Gained on Verde Contribution Margin Lost on Azul Net Increase in Contribution Margin Change in Fixed Costs Net Change in Profit if Azul is Eliminated Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Trap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution margin $25,000 $29,000 $4,000 $ 59,000 Less: Direct 1,900 2,500 2,000 6,400 fixed costs Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Common fixed 17,840 17,840 8,920 44,600 costs Net operating $ 6,260 $ 8,660 $(6,920) $ 8,000 income (loss) "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp. drops the Azul line. 1-b. Will Mohave's net operating income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production information and the entire $51,000 of fixed cost was common fixed cost. 3-b. Should Mohave drop the Azul model? 3-c. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Req 30 Req 1A Reg 1B Req2 Reg 3A Req 3B Should Mohave drop the Azul model? Yes ONO Req 3A Req 30 > Mohave Corp. is considering eliminating a product from its Sand Trap line of beach umbrellas. This collection is aimed at people who spend time on the beach or have an outdoor patio near the beach. Two products, the Indigo and Verde umbrellas, have impressive sales. However, sales for the Azul model have been dismal. Mohave's information related to the Sand Trap line is shown below. Segmented Income Statement for Mohave's Sand Trap Beach Umbrella Products Indigo Verde Azul Total Sales revenue $60,000 $60,000 $30,000 $150,000 Variable costs 34,000 31,000 26,000 91,000 Contribution $26,000 $29,000 $ 4,000 $ 59,000 margin Less: Direct fixed costs 1,900 2,500 2,000 6,400 Segment margin $24,100 $26,500 $ 2,000 $ 52,600 Cormon fixed 17,840 17,840 8,920 44,600 costs Net operating $ 6,260 $ 8,660 $(6,920) $ 8,000 income (losa) "Allocated based on total sales revenue Mohave has determined that eliminating the Azul model would cause sales of the Indigo and Verde models to increase by 10 percent and 15 percent, respectively. Variable costs for these two models would increase proportionately. Although the direct fixed costs could be eliminated, the common fixed costs are unavoidable. The common fixed costs would be redistributed to the remaining two products. Required: 1-a. Complete the table given below, assuming Mohave Corp. drops the Azul line. 1-b. Will Mohave's net operating Income increase or decrease if the Azul model is eliminated? By how much? 2. Should Mohave drop the Azul model? 3-a. Complete the table given below assuming that Mohave had no direct fixed overhead in its production Information and the entire $51,000 of fixed cost was common fixed cost. 3-6. Should Mohave drop the Azul model? 3-c. What is the increase or decrease in the net operating income of Mohave? Complete this question by entering your answers in the tabs below. Req1A Reg 1B Req2 Reg 3A Req 38 Reg 30 What is the increase or decrease in the net operating income of Mohave? Change in Net Operating Income (Loss) Req3B Reg 3C