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please solve it all by typing to be clear for me & do table & explnation if the question need , thankyou Question 2 (27
please solve it all by typing to be clear for me & do table & explnation if the question need , thankyou
Question 2 (27 points) Ellie Ice-cream's owner is disturbed by the poor profit performance of his ice cream counter. He has prepared the following profit analysis for the year just ended: Eliminate the counter Keep the counter 400,000 160,000 100,000 10,000 130,000 Sales Revenues Less: Variable expenses Direct Material Direct Labor Variable Overhead Contribution margin Less: Fixed expenses Depreciation of counter equipment Supervisory salaries Insurance Depreciation of building (allocated) General overhead (allocated) Net profit 20,000 30,000 30,000 25,000 25,000 can colle co the Middle East, 2020 The owner is thinking the elimination of this counter. If it is eliminated then: Depreciation of counter equipment is avoidable The supervisory salaries is avoidable The insurance expense is unavoidable The depreciation of building unavoidable The general overhead is unavoidable Required: a) Should the company eliminate the counter or not? Fill in the table and justify your answer. (21 points) b) Mention at least three relevant costs. (6 points) Step by Step Solution
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