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PLSSS URGENTT B. The following information relates to Dahlia who runs a boutique in a busy shopping mall in Kuala Lumpur since 2017. She has
PLSSS URGENTT
B. The following information relates to Dahlia who runs a boutique in a busy shopping mall in Kuala Lumpur since 2017. She has three sections of clothing, namely baju kurung, casual blouse and batik pieces. Her daughter, Sara who recently graduated with an accounting degree, prepared the income statement and showed that the batik pieces department is running a loss of RM14,000. Dahlia is now considering dropping the batik pieces section. The following information relates to the first 12 months of operations. Baju kurung Casual blouse Batik pieces Sales 120,000 75,000 97,000 Total costs 86,000 47,000 111,000 Net profit/ (loss) 34,000 28,000 (14,000) Page 5 of 6 Total fixed costs amounted to RM30,000, which is apportioned equally to the sections. Required: Advise Dahlia on whether the batik pieces section should be dropped or not. (Show all workings). (10 marks)Step by Step Solution
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