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Variable and Absorption Costing-Three Products Winslow Inc. manufactures and sells three types of shoes. The income statements prepared under the absorption costing method for the

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Variable and Absorption Costing-Three Products Winslow Inc. manufactures and sells three types of shoes. The income statements prepared under the absorption costing method for the three shoes are as follows: Winslow Inc. Product Income Statements-Absorption Costing For the Year Ended December 31, 2011 Cross Training Shoes Golf Shoes Running Shoes Revenues $423,300 $241,300 $200,300 Cost of goods sold (220,100) (118,200) (134,200) Gross profit $203,200 $123,100 $66,100 Selling and administrative expenses (174,800) (88.600) (110,400) Operating income $28,400 $34,500 $(44,300) In addition, you have determined the following information with respect to allocated fixed costs: running shoes be avoided if the line is eliminated b. Prepare a variable costing income statement for the three products. Enter a net loss as a negative number using a minus sign. Winslow Inc. Variable Costing Income Statements-Three Product Lines For the Year Ended December 31, 2011 Cross Training Shoes Golf Shoes Running Shoes Fixed costs: LOUI Total fixed costs Operating income (loss) c. Use the report in (b) to determine the profit impact of eliminating the running shoeline, assuming no other changes If the running shoes line were eliminated, then the contribution margin of the product line would eliminated. Thus, the profit of the company would actually by profitability of the product by prices volume, or and the fixed costs be Management should keep the line and attempt to improve the costs Check My W

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