Discontinue a Segment Product Tango has revenue of $195,500, variable cost of goods sold of $115,200, variable selling expenses of $31,000, and fixed costs of $60,300, creating an operating loss of $(11,000). a. Prepare a differential analysis as of February 13 to determine if Product Tango should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Continue Product Tango Revenues Costs: Differential Analysis (Alt. 1) or Discontinue Product Tango (Alt. 2) February 13 Variable cost of goods sold Variable selling and admin. expenses Fixed costs Profit (Loss) Continue Product Tango Discontinue Product Tango (Alternative 1) (Alternative 2) Differential Effects (Alternative 2) b. Determine if Product Tango should be continued (Alternative 1) or discontinued (Alternative 2).
Discontinue a Segment Product Tango has revenue of $195,500, variable cost of goods sold of $115,200, variable selling expenses of $31,000, and fixed costs of $60,300, creating an operating loss of $(11,000). a. Prepare a differential analysis as of February 13 to determine if Product Tango should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Continue Product Tango Revenues Costs: Differential Analysis (Alt. 1) or Discontinue Product Tango (Alt. 2) February 13 Variable cost of goods sold Variable selling and admin. expenses Fixed costs Profit (Loss) Continue Product Tango Discontinue Product Tango (Alternative 1) (Alternative 2) Differential Effects (Alternative 2) b. Determine if Product Tango should be continued (Alternative 1) or discontinued (Alternative 2).
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter25: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 2BE
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