Welcome to Westonci.ca, the place where your questions are answered by a community of knowledgeable contributors. Get immediate answers to your questions from a wide network of experienced professionals on our Q&A platform. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.
Sagot :
Answer:
Company's net income will increase by $2500 if the product line is discontinued.
Explanation:
From the data given:
Sales                    25000
variable cost (less) Â Â Â Â Â Â Â Â 19000
contribution margin        6000
Fixed costs
directed fixed costs         7000
allocated fixed costs        5000
net income               -6000
Fixed cost savings          7000
rental revenue              1500
total savings if discontinued   8500
contribution margin (less) Â Â Â Â 6000
net income increased by      2500
We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Thank you for visiting. Our goal is to provide the most accurate answers for all your informational needs. Come back soon. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.