Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

NEED PART B ASAP Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below: Sales Variable

NEED PART B ASAP image text in transcribed
image text in transcribed
image text in transcribed
Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below: Sales Variable expenses Contribution margin Fixed expenses Net income Assurance $453,300 226,650 226,650 177,300 $49,350 Decoder $755,500 302,200 453,300 342,400 $110.900 Burglar Beware $294,700 206,290 88,410 143,800 $(55,390) Fixed expenses consist of $442,800 of common costs allocated to the three products based on relative sales, and additional fixed costs of $45,800 (Assurance). $122,100 (Decoder), and $52,800 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Matt Dillon, an executive with the company with extensive law enforcement background, feels that the Burglar Beware line should be discontinued to increase the company's net income. Your answer is correct. Compute current net income for Safe and Secure, Inc. (Enter loss using either a negative sign preceding the number eg. -2,945 or parentheses es. (2.945)) Net income 104,860 Compute net income by product line and in total for Safe and Secure, Inc. If the company discontinues the Burglar Beware product line. (Hint: Allocate the $442,800 common costs to the two remaining product lines based on their relative sales.) (Enter foss using either a negative sign preceding the number eg. -2,945 or parentheses es. (2,945)) Assurance Decoder Company Total Net income $ $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions