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Suffolk China Ware Company Product-Line Income Statement For the Month Ended May 31 Bowls Plates Cups Sales $64,500 $89,200 $26,000 Cost of goods sold 26,300
Suffolk China Ware Company Product-Line Income Statement For the Month Ended May 31 Bowls Plates Cups Sales $64,500 $89,200 $26,000 Cost of goods sold 26,300 33,600 15,800 Gross profit $38,200 $55,600 $10,200 Selling and administrative expenses Income from operations 28,500 $9,700 35,200 $20,400 16,200 $(6,000) Fixed costs are 12% of the cost of goods sold and 36% of the selling and administrative expenses. Suffolk China Ware assumes that fixed costs would not be materially affected if the Cups line were discontinued. a. Prepare a differential analysis dated May 31 to determine whether to Continue Cups (Alternative 1) or Discontinue Cups (Alternative 2). If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Continue Cups (Alt. 1) or Discontinue Cups (Alt. 2) For the Month Ended May 31 Revenues Costs: Variable cost of goods sold Variable selling and admin. expenses Fixed costs Profit (loss) Continue Cups (Alternative 1) Discontinue Cups (Alternative 2) Differential Effect (Alternative 2) 0000
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