Outdoor Luggage Corporation produces hard-sided luggage for sports equipment Financial data for three of the corporation's most popular products appear below. Total Ski Guard Golf Guard Fishing Guard $ 929,000 $266,800 $ 406,eee $ 257,880 465,000 117, cee 191, eee 157.eee 464,000 149, eee 215, eee 100,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses Total fixed expenses Net operating income (loss) 70, 10e 8,900 40,900 20,300 44,5ee 20,900 8,888 15,600 113,800 40,400 38,3ee 35,180 185,800 53,200 81,200 51,400 414, 200 123, 4ee 168,400 122, 4ee $ 49,8ee $ 25,600 $ 46,600 $(22,40e) "Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the fishing guards and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce fishing guards has no resale value and does not wear out Management is concerned about the continued losses shown by the fishing guards and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce fishing guards has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the fishing guard model? 2. Should the production and sale of fishing guards be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the fishing guards? Required 1 Required 2 > Management is concerned about the continued losses shown by the fishing guards and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce fishing guards has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the fishing guard model? 2. Should the production and sale of fishing guards be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Should the production and sale of fishing guards be discontinued? OYes No Required 1 Required 2 Required 3 Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long- run profitability of the various product lines. Totals Ski Guards Golf Guards Fishing Guards Contribution margin (loss) Traceable fixed expenses Total traceable fixed expenses Product line segment margin (loss) Net operating income (oss)
