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Swifty Corporation produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows: Wood Aluminum
Swifty Corporation produces three versions of baseball bats: wood, aluminum, and hard rubber. A condensed segmented income statement for a recent period follows:
Wood | Aluminum | Hard Rubber | Total | ||||
---|---|---|---|---|---|---|---|
Sales | $520000 | $210000 | $65000 | $795000 | |||
Variable expenses | 275000 | 70000 | 58000 | 403000 | |||
Contribution margin | 245000 | 140000 | 7000 | 392000 | |||
Fixed expenses | 75000 | 35000 | 22000 | 132000 | |||
Net income (loss) | $170000 | $ 105000 | $(15000) | $260000 |
Assume none of the fixed expenses for the hard rubber line are avoidable. What will be total net income if the line is dropped?
$70000
$125000
$275000
$253000
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