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The management accountant for Giada's Book Store has prepared the following income statement for the most current year: Cookbook Travel Book Classics Total Sales $60,000
The management accountant for Giada's Book Store has prepared the following income statement for the most current year:
Cookbook | Travel Book | Classics | Total | |
Sales | $60,000 | $100,000 | $60,000 | $220,000 |
Cost of goods sold | 40,000 | 67,000 | 22,000 | 129,000 |
Contribution margin | 20,000 | 33,000 | 38,000 | 91,000 |
Order and delivery processing | 21,000 | 22,000 | 10,000 | 53,000 |
Rent (per sq. foot used) | 5000 | 1000 | 5000 | 11,000 |
Allocated corporate costs | 8000 | 8000 | 8000 | 24,000 |
Corporate profit | $(14,000) | $2000 | $15,000 | $3000 |
If the travel book line had been discontinued, corporate profits for the current year would have decreased by: (Assume there is not an alternative use for the space rented.)
Question 36 options:
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$11,000
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$10,000
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$33,000
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$2000
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