Wildhorse Toys management is considering eliminating product A, which has been showing a loss for several years. The companys annual income statement, is as follows:

		A		B		C		Total
Sales		$2,292,000		$1,400,000		$1,818,500		$5,510,500
Variable expenses		1,658,000		600,200		1,091,900		3,350,100
Contribution margin		$634,000		$799,800		$726,600		$2,160,400
Advertising expense		$530,000		$429,000		$520,000		$1,479,000
Depreciation expense		17,100		10,600		21,900		49,600
Corporate expenses		90,600		80,700		105,600		276,900
Total fixed expenses		$637,700		$520,300		$647,500		$1,805,500
Operating income		$(3,700)		$279,500		$79,100		$354,900

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.

Operating income $3.700) $279,500 $79,100 $351,900 Advertising expense - Specific to each product. Dearcaatian expense - Specific to each aroduct; no other use ava able, na resale value. Corporate expenses - Allocated based on number of employees. (a) Your answer is correct. Restate the income statement in segment margin format. A B C Total Sales Revence $2292000 100000 $11618500 $510500 Variable experses 165 na 600,200 1109100945010 Contribution margin 634000 1299800 725600 2160400 Less Direct fixed expenses evertising zabeza azudo 6209a 927930 Depreciation 117100 410600_121900 9500 Segment marcin area 6300 584700 2.200 Less Common fixed expenses Morerating profil Attempts: 2 of 15 used *(b) Your answer is commit. What would be the effect on income il product A were dropped? Net Income would decrease by cool. Attempts: 7 of 15 used "(c) x Your answer is incorrect. Try again. Management is considering making a new product using product A's equipment. If the new product's selling prica per unit were s i variable costs were 14, 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 nen procuct worthwhile? (Round answers to O decimal places, e.g. 125.) Unit 44 Attempts: 1 of 15 used