Sheridan Toys' management is considering eliminating product A, which has been showing a loss for several years. The company's annual income statement, is as follows: B Sales Variable expenses Contribution margin Advertising expense Depreciation expense Corporate expenses $2,289,000 1,689,000 $600,000 $505,000 17,700 $1,405,000 600,700 $804,300 Total $1,807,800 $5,501,800 1,084,300 3,374,000 $723,500 $2,127,800 $522,000 $1,453,000 20,100 48,800 $426,000 11,000 93,900 82,100 105,600 281,600 Total fixed expenses $519,100 $647,700 $1,783,400 $616,600 $(16,600) Operating income $285,200 $75,800 $344,400 Advertising expense - Specific to each product. Depreciation expense - Specific to each product; no other use available, no resale value. Corporate expenses - Allocated based on number of employees. (c) * Your answer is incorrect. Management is considering making a new product using product A's equipment. If the new product's selling price per unit were $10, its variable costs were $5, and its advertising costs were the same as for product A, how many units of the new product would the company have to sell to make the switch from product A to the new product worthwhile? Units 104,540 e Textbook and Media Save for Later Attempts: 1 of 3 used Submit