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Right and Wrong, Inc. produces three models of home security systems. Information on the three products is given below: Assurance Decoder Burglar Beware Sales $447,000
Right and Wrong, Inc. produces three models of home security systems. Information on the three products is given below: Assurance Decoder Burglar Beware Sales $447,000 $745,000 $299,800 Variable expenses 223,500 298,000 209,860 Contribution margin 223,500 447,000 89,940 Fixed expenses 181,800 348,500 144,100 Net income $41,700 $98,500 $(54,160) Fixed expenses consist of $456,800 of common costs allocated to the three products based on relative sales, and additional fixed costs of $44,200 (Assurance), $121,300 (Decoder), and $52,100 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Matt Dillon, an executive with the company with extensive law enforcement background, feels that the Burglar Beware line should be discontinued to increase the company's net income. (a) Compute current net income for Right and Wrong, Inc. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Net income $
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