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Rowan Coffee Co. incurs a loss from operations for the Standard Coffee line. Sales revenues for the line total $72,000, while incurring variable costs of
Rowan Coffee Co. incurs a loss from operations for the Standard Coffee line. Sales revenues for the line total $72,000, while incurring variable costs of goods sold of $19,500, variable selling expenses of $17,400, and fixed costs of $49,000. Determine if the Standard Coffee line should be continued or discontinued. Assume the company will incur the fixed costs regardless of the decision. Support your conclusion with numbers.
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