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Top managers of Sunset Video, a company providing movie rentals via vending machines or online, are alarmed by their operating losses. They are considering
Top managers of Sunset Video, a company providing movie rentals via vending machines or online, are alarmed by their operating losses. They are considering dropping the vending machine product line. Company accountants have prepared the following analysis to help make this decision View the analysis, Assume that Sunset Videocan avoid $44,000 of direct fixed costs by dropping the vending machine product line. Prepare a differential analysis to show whether Sunset Video should stop renting movies via the vending machines. (Enter decreases to revenues with a parentheses or minus sign) Expected decrease in revenues Expected decrease in costs: Variable costs Fixed costs Expected decrease in total costs Expected increase in operating income $ (120,000) C me y.docx egushi wing FINAL wing NAL p Top manage vending ma View the an Assume that should stop Anaylysis Sunset Video Income Statement For the Year Ended December 31, 2025 - ir operating Vending Total Online Rental Machine Net Sales Revenue 422,000 $ 302,000 $ 120,000 Expected 249,000 159,000 90,000 Expected Variable Costs Variab Contribution Margin 173,000 143,000 30,000 Fixed Fixed Costs: Manufacturing 134,000 79,000 55,000 Expect Selling and Administrative 72,000 53,000 19,000 Expected Total Fixed Costs 206,000 132,000 74,000 (33,000) $ 11,000 $ Operating Income (Loss) (44,000) Ask my instructor Print Done e a differen
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