Question

Pantheon Gaming, a computer enhancement company, has three product lines: audio enhancers, video enhancers, and connection-speed accelerators. Common costs are allocated based on relative sales. A product line income statement follows:


Since the profit for accelerator devices is relatively low, the company is considering dropping this product line.

Required
a. Determine the impact on profit of dropping accelerator products.
b. Discuss the potential qualitative effects of discontinuing the sale of acceleratorproducts.


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  • CreatedSeptember 23, 2013
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