Product-Line Income Statement For the Month Ended October 31 Hats Mufflers Gloves $88,700 (31,800) $27,300 (14,700) Sales $64,200 Cost of goods sold Gross profit (27,100) $37,100 $56,900 $12,600 Selling and administrative expenses Operating income (loss) (35,700) (14,900) $(2,300) (28,400) $21,200 $8,700 Fixed costs are 15% of the cost of goods sold and 36% of the selling and administrative expenses. Rhinebeck Company assumes that ixed costs would not be materially affected if the Gloves line were discontinued.
Product-Line Income Statement For the Month Ended October 31 Hats Mufflers Gloves $88,700 (31,800) $27,300 (14,700) Sales $64,200 Cost of goods sold Gross profit (27,100) $37,100 $56,900 $12,600 Selling and administrative expenses Operating income (loss) (35,700) (14,900) $(2,300) (28,400) $21,200 $8,700 Fixed costs are 15% of the cost of goods sold and 36% of the selling and administrative expenses. Rhinebeck Company assumes that ixed costs would not be materially affected if the Gloves line were discontinued.
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter2: Basic Managerial Accounting Concepts
Section: Chapter Questions
Problem 26BEA
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Differential Analysis for a Discontinued Product
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