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Q16. Nongshin Company manufactures various types of instant noodles and the November 2021 income statement for selected two models is presented: Cold Spicy Hot Super
Q16. Nongshin Company manufactures various types of instant noodles and the November 2021 income statement for selected two models is presented: Cold Spicy Hot Super Spicy Net Sales Revenue $12,600 $7,920 Cost of Goods Sold Variable $8,120 $5,280 Fixed $1,650 $970 Gross Profit $2,830 $1,670 Selling and Administrative Expenses Variable $3,360 $1,600 Fixed $280 $190 Operating Income ($810) ($120) If Nongshin drops any of these product lines, the fixed selling and administrative expenses can be avoided but none of the fixed cost of goods sold can be avoided. Which of these two products should be dropped or not? Nongshin should drop cold spicy noodle only. Nongshin should drop hot super spicy noodle only. Nongshin should drop both products. O Nongshin should drop none of them
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