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Top managers of Best Video are alarmed by their operating losses. They are considering dropping the DVD product line. Company accountants have prepared the following
Top managers of Best Video 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: E (Click the icon to view the analysis.) Assume that Best Video can avoid $45,000 of fixed costs by dropping the DVD product line (these costs are direct fixed costs of the DVD product line). Prepare a differential analysis to show whether Best Video should stop selling DVDS. (Enter decreases to revenues withaparantheces er minue cian 1 Data Table Expected decrease in revenues Expected decrease in expenses: Variable expenses Best Video Fixed expenses Income Statement For the Year Ended December 31, 2016 Expected decrease in total expenses Blu-ray DVD in operating income Expected Total Discs Discs 309,000 $ Sales Revenue 432,000 $ 123,000 150,000 240,000 90,000 Variable Costs Contribution Margin 192,000 159,000 33,000 Fixed Costs: Manufacturing 134,000 75,000 59,000 69,000 17,000 52,000 Selling and Administrative Choose from any list or enter any number in the input fields and then click Check Answer. 203,000 127,000 76,000 Total Fixed Expenses part remaining Che (11,000) $ (43,000) 32,000 $ Operating Income (Loss)
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