View Policies Current Attempt in Progress Pharoah Toys' management is considering eliminating product A, which has been showing a loss for several years. The company's annual income statement, is as follows: B Total Sales $2,213,000 $1,409,000 $1,802,900 $5,424,900 Variable expenses 1,652,000 601,700 1,084,300 3,338,000 Contribution margin $561,000 $807,300 $718,600 $2,086,900 Advertising expense $523,000 $430,000 $520,000 $1,473,000 Depreciation expense 16,700 10,500 20,300 47,500 Corporate expenses 94,300 84,900 105,200 284,400 Total fixed expenses $634,000 $525,400 $645,500 $1,804,900 Operating income $(73,000) $281,900 $73,100 $282,000 Advertising expense - Specific to each product. Depreciation expense - Specific to each product; no other use available, no resale value. Corporate expenses - Allocated based on number of employees. Restate the income statement in segment margin format. A B $ $ $ $ e Textbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (b) What would be the effect on income if product A were dropped? - ACC-650 TOPIC 5 Assignment Question 11 of 11 - 19 Save for Later naen e Inn .cadmanw Submit Answer (c) Management is considering making a new product using product A's equipment. If the new product's selling price per unit were $10, its variable costs were $5, and its advertising costs were the same as for product A, how many units of the new product would the company have to sell to make the switch from product A to the new product worthwhile? Units e Textbook and Media Save for Later Attempts: 0 of 3 used Submit