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The income statement of the BOSEN Company for the 2020 fiscal year is as follows: Sales revenue 395.000.000 Variable cost 250.000.000 Contribution profit 145.000.000 Fixed
The income statement of the BOSEN Company for the 2020 fiscal year is as follows:
Sales revenue | 395.000.000 |
Variable cost | 250.000.000 |
Contribution profit | 145.000.000 |
Fixed costs (avoidable) | 140.000.000 |
Fixed costs (unavoidable) | 30.000.000 |
Net profit (loss) | ( 25.000.000 ) |
Management estimates that the losses suffered by the company will continue, so it is considered to be discontinued.
a. What should be done, stop or continue the operation?
b. If the facilities owned by the company can be rented out for $50.000.000 What should be done?
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