The IGREG company manufactures and sells 15,000 units per month of product A and 30,000 units per

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The IGREG company manufactures and sells 15,000 units per month of product A and 30,000 units per month of product B. The selling price of product A is $40 per unit and its variable cost is $28 per unit. The selling price of product B is $29 per unit and its variable cost is $17 per unit. IGREG is considering the elimination of Product A. A study has shown that if Product A is eliminated, $140,000 of its total fixed costs of $200,000 cannot be eliminated. What is the impact of the elimination of product A on the profit of the company?

a- decrease of $120,000

b- decrease of $60,000

c- increase of $20,000

d- decrease of $180,000

e- No answer fits

Posted Date: May 31, 2024 10:17 AM

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