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The managers of Adamson Apple Company are considering dropping one of their product lines. The product line typically has the following revenue and costs: Sales
The managers of Adamson Apple Company are considering dropping one of their product lines. The product line typically has the following revenue and costs: Sales $ Variable costs Contribution margin Fixed costs Operating loss If the product line is discontinued $ of the fixed costs would be avoided Also, the freedup capacity would generate of additional contribution margin from the expansion of other product line. If Adamson discontinues the product line, the effect on overall income will be a a $ decrease b $ decrease. $ increase d $ increase.
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