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The management of a corporation is considering dropping product C 2 . Data from the company's accounting system appear below: Sales $ 7 2 0
The management of a corporation is considering dropping product C Data from the company's accounting system appear below:
Sales
$
$
$
$
Variable expenses
Fixed manufacturing expenses
Fixed selling and administrative expenses
All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $ of the fixed manufacturing expenses and $ of the fixed selling and administrative expenses are avoidable if product is discontinued.
What would be the financial advantage disadvantage of dropping C Should the product be dropped?
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