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Question 6 3 pts Betty DeRose, Inc. sells three products. Income statements for the three products for the most recent year appear below: Product #1
Question 6 3 pts Betty DeRose, Inc. sells three products. Income statements for the three products for the most recent year appear below: Product #1 $140,000 Product #2 $120,000 Product #3 $200,000 Sales revenue Costs: Variable production cos Advertising Rent ................ Supervisor's salary Sales commissions ....... Net income/loss ........ 91,000 15,000 14,000 20,000 1,000 48,000 12,000 14,000 20,000 6,000 20,000 140,000 10,000 14,000 20,000 10,000 6,000 The rent is allocated to the three products equally and sales commissions are paid at a rate of 5% of sales. The company is considering eliminating Product #1. If Product #1 is dropped, sales of Product #2 are expected to increase by 25%. Calculate the amount of net income Betty DeRose, Inc. would expect to generate in the coming year if Product #1 is eliminated
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