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The following infomation is for three of X Company's products: Product A Product B Product C Contribution margin rate Fixed costs Profit 0.35 $24,818 $10,636
The following infomation is for three of X Company's products: Product A Product B Product C Contribution margin rate Fixed costs Profit 0.35 $24,818 $10,636 0.40 $32,984 $14,136 0.43 $39,070 $-3,552 Sales of Product C were $82,600, but X Company is still considering dropping it because of its reported loss. If it does, $19,535 of the fixed costs associated with it can be avoided, and sales of Product A can be increased by $44,000. If X Company does drop Product C and increases sales of Product A, X Company's profits will change by Tries 0/4
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