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Differential Analysis for a Discontinued Product A condensed income statement by product line for Lavonia Beverage Inc. indicated the following for Vim Cola for the
Differential Analysis for a Discontinued Product A condensed income statement by product line for Lavonia Beverage Inc. indicated the following for Vim Cola for the past year: It is estimated that 16% of the cost of goods sold represents fixed factory overhead costs and that 21% of the operating expenses are fixed. Because Vim cola is only on products, the fixed costs will not be materially affected if the product is discontinued. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. Open spreadsheet a. Prepare a differential analysis dated November 2 to determine whether Vim Cola should be continued (Alternative 1 ) or discontinued (Alternative 2 ). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss
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