Safe and Secure, Inc. produces three models of home security systems. Information on the three products...

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Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below: Assurance Decoder Burglar Beware $443,700 $739,500 221,850 295,800 221,850 443,700 182,500 347,300 $96,400 $39,350 Sales Variable expenses Contribution margin Fixed expenses Net income Fixed expenses consist of $457,800 of common costs allocated to the three products based on relative sales, and additional fixed costs of $44,300 (Assurance), $119,000 (Decoder), and $53,000 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Matt Dillon, an executive with the company with extensive law enforcement background, feels that the Burglar Beware line should be discontinued to increase the company's net income. (a) Your answer is correct. $299,300 209,510 89,790 144,300 $(54,510) Compute current net income for Safe and Secure, Inc. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Net income $ 81240 (b) Compute net income by product line and in total for Safe and Secure, Inc., if the company discontinues the Burglar Beware product line. (Hint: Allocate the $457,800 common costs to the two remaining product lines based on their relative sales.) (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Net income $ Assurance eTextbook and Media Save for Later $ Decoder $ Company Total Attempts: 0 of 5 used (c) The parts of this question must be completed in order. This part will be available when you complete the part above. (d) The parts of this question must be completed in order. This part will be available when you complete the part above. Submit Answer Safe and Secure, Inc. produces three models of home security systems. Information on the three products is given below: Assurance Decoder Burglar Beware $443,700 $739,500 221,850 295,800 221,850 443,700 182,500 347,300 $96,400 $39,350 Sales Variable expenses Contribution margin Fixed expenses Net income Fixed expenses consist of $457,800 of common costs allocated to the three products based on relative sales, and additional fixed costs of $44,300 (Assurance), $119,000 (Decoder), and $53,000 (Burglar Beware). The common costs will be incurred regardless of how many models are produced. The other fixed expenses would be eliminated if a model is phased out. Matt Dillon, an executive with the company with extensive law enforcement background, feels that the Burglar Beware line should be discontinued to increase the company's net income. (a) Your answer is correct. $299,300 209,510 89,790 144,300 $(54,510) Compute current net income for Safe and Secure, Inc. (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Net income $ 81240 (b) Compute net income by product line and in total for Safe and Secure, Inc., if the company discontinues the Burglar Beware product line. (Hint: Allocate the $457,800 common costs to the two remaining product lines based on their relative sales.) (Enter loss using either a negative sign preceding the number e.g. -2,945 or parentheses e.g. (2,945).) Net income $ Assurance eTextbook and Media Save for Later $ Decoder $ Company Total Attempts: 0 of 5 used (c) The parts of this question must be completed in order. This part will be available when you complete the part above. (d) The parts of this question must be completed in order. This part will be available when you complete the part above. Submit Answer

Answer rating: 100% (QA)

Allocating Burglar Beware Common fixed cost Assura... View the full answer