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The following additional information is available: * The factory rent of $1,500 assigned to Product C is avoidable if the product were dropped. * The
The following additional information is available: |
* The factory rent of $1,500 assigned to Product C is avoidable if the product were dropped. |
* The company's total depreciation would not be affected by dropping C. |
* Eliminating Product C will reduce the monthly utility bill from $1,500 to $800. |
* All supervisors' salaries are avoidable. |
* If Product C is discontinued, the maintenance department will be able to reduce monthly expenses from $3,000 to $2,000. |
* Elimination of Product C will make it possible to cut two persons from the administrative staff; their combined salaries total $3,000. |
Required: |
Prepare an analysis showing whether Product C should be eliminated. |
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