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Question 2 (10 mins, 10 marks) When Mr. Ding L. Berry, president of Berry Inc., first saw the segmented income statement below, he flew into
Question 2 (10 mins, 10 marks) When Mr. Ding L. Berry, president of Berry Inc., first saw the segmented income statement below, he flew into his usual rage. "When will we ever start showing a real profit? I'm starting immediate steps to eliminate those two unprofitable lines!" Product Lines Total U V W Sales $ 250,000 $ 100,000 $ 75,000 $ 75,000 Variable Expenses 119,000 37,000 35,000 47,000 Contribution Margin 131,000 63,000 40,000 28,000 Traceable Fixed expenses* 98,000 31,000 37,000 30,000 Common expenses 32,900 18,000 10,500 4,400 allocated Operating Income/Loss $ 100 $ 14,000 $_(7,500) $_(6,400) * These traceable expenses could be eliminated if the product lines to which they are traced were discontinued. Required: Recommend which segments, if any, should be eliminated. Prepare a report in good form to support your
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