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When Rosana, CFO of Hydie Inc., first evaluated the segmented income statement below, he flew into his usual rage: When are we having losses in

When Rosana, CFO of Hydie Inc., first evaluated the segmented income statement below, he flew into his usual rage: "When are we having losses in our product lines, I would rather eliminate them.

*These traceable expenses could be eliminated if the product lines to which they are traced were discontinued.

Product Lines

Total

U

V

W

Sales

$250,000

$100,000

$75,000

$75,000

Variable expenses

$119,000

$37,500

$35,000

$47,000

Contribution margin

$131,000

$63,000

$40,000

$28,000

Traceable fixed expenses*

$98,000

$31,000

$37,000

$30,000

Common expenses, allocated

$32,900

$18,000

$10,500

$4,400

Operating income (loss)

$100

$14,000

$(7,500)

$(6,400)

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