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Top managers of Video Street are alarmed by their operating losses. They are considering dropping the DVD product line. Company accountants have prepared the following
Top managers of Video Street are alarmed by their operating losses. They are considering dropping the DVD product line. Company accountants have prepared the following analysis to help make this decision (Click the icon to view the analysis.) Total fixed costs will not change if the company stops selling DVDs. Read the requirements - Requirement 1. Prepare a differential analysis to show whether Video Street should drop the DVD product line. Begin by preparing a differential analysis to show whether Video Street should drop the DVDs product line. (Enter decreases to profits with a parentheses or minus sign.) Expected decrease in revenuesDropping DVDs X Data Table Expected decrease in costs-Dropping DVDs Expected in operating income Video Street Income Statement For the Year Ended December 31, 2024 Total Blu-ray Discs DVD Discs $ 426,000 $ 301,000 $ 125,000 250,000 158,000 92,000 Net Sales Revenue Variable Costs Contribution Margin 176,000 143,000 33,000 Fixed Costs: Manufacturing 56,000 126,000 66,000 70,000 57,000 9,000 Selling and Administrative Total Fixed Costs 192.000 127,000 65,000 Choose from any list or enter any number in the input fields and ti $ (16,000) 16,000 $ (32,000) Operating Income (Loss)
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