6. The management of Kabanuck Corporation is considering dropping product V41B.

Question

6. The management of Kabanuck Corporation is considering dropping product V41B. Deta from the company's accounting system appear below Sales Variable expenses Flxed manufacturing expenses Fixed selling and administrative expenses $933,000 412,000 $347000 S254,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $214,000 of the fixed manufacturing expenses and $125,000 of the fixed selling and administrative expenses are avoidable if product V41B is discontinued. According to the company's accounting system, what is the net operating income eamed by product V41B? O$/521,000 O $1521,000) $521,000 O $80,000 O$80.000 $180,000)

Explanation / Answer

Answer is $(80,000)

Sales $933,000 Variable expenses (412,000) Contribution margin 521,000 Fixed manufacturing expenses (347,000) Fixed selling and administrative expenses (254,000) Net operating income $(80,000)

Related Questions

Navigate

• Browse (All)
• Browse 6
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.