Suppose that Blowing Sand Company also produces the Drafty model fan, which currently has a net loss
Question:
Eliminating the Drafty product line would eliminate $18,000 of direct fixed costs. The $50,000 of common fixed costs would be redistributed to Blowing Sand€™s remaining product lines. Will Blowing Sand's net operating income increase or decrease if the Drafty model is eliminated? By how much?
Transcribed Image Text:
Drafty Model $150,000 125,000 $25,000 18,000 $ 7,000 50,000 $ (43,000) Sales revenue Less: Variable costs Contribution margin Segment margin Net operating income (loss) Less: Direct fixed costs Less: Common fixed costs
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 85% (14 reviews)
Contribution Margin Given Up 25000 DirectAvoidable Fixed C...View the full answer
Answered By
ANDREW KIPRUTO
Academic Writing Expert
I have over 7 years of research and application experience. I am trained and licensed to provide expertise in IT information, computer sciences related topics and other units like chemistry, Business, law, biology, biochemistry, and genetics. I'm a network and IT admin with +8 years of experience in all kind of environments.
I can help you in the following areas:
Networking
- Ethernet, Wireless Airmax and 802.11, fiber networks on GPON/GEPON and WDM
- Protocols and IP Services: VLANs, LACP, ACLs, VPNs, OSPF, BGP, RADIUS, PPPoE, DNS, Proxies, SNMP
- Vendors: MikroTik, Ubiquiti, Cisco, Juniper, HP, Dell, DrayTek, SMC, Zyxel, Furukawa Electric, and many more
- Monitoring Systems: PRTG, Zabbix, Whatsup Gold, TheDude, RRDtoo
Always available for new projects! Contact me for any inquiries
4.30+
1+ Reviews
10+ Question Solved
Related Book For
Managerial Accounting
ISBN: 978-0078025518
2nd edition
Authors: Stacey Whitecotton, Robert Libby, Fred Phillips
Question Posted:
Students also viewed these Managerial Accounting questions
-
Required: a. By how much would companywide income increase or decrease if West Division is eliminated? Should West Division be eliminated? b. Assume that West Division is able to increase its revenue...
-
Would potential agency problems increase or decrease if you expanded operations to other campuses? Would agency problems be affected by whether you expanded by licensing franchisees or by direct...
-
Blowing Sand Company also has the Blast fan model. It is the company's top-selling model with sales of 30,000 units per year. This model has a dual fan as well as a thermostat component that causes...
-
Which of the following pairs of steps in the programming process is in the correct order? a. Code the program, plan the logic b. Test the program, translate it into machine language c. Put the...
-
Concerning the exemption for U.S. Savings Bond interest used for education expenses, what are the lower and upper income limitations for married taxpayers, and how is the exemption determined when...
-
If a current of one- or two-tenths of an ampere were to flow into one of your hands and out the other, you would probably be electrocuted. But if the same current were to flow into your hand and out...
-
Suppose over the period \([0, T]\) a certain stock pays a dividend whose present value at interest rate \(r\) is \(D\). Show that the put-call parity relation for European options at \(t=0\),...
-
The following data were adapted from a recent income statement of Procter & Gamble Company: (in millions) Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....
-
On January 1, 2023, Stream Company acquired 25 percent of the outstanding voting shares of Q-Video, Incorporated, for $718,000. Q- Video manufactures specialty cables for computer monitors. On that...
-
Use the data set GPA1 to answer this question. It was used in Computer Exercise C13 in Chapter 3 to estimate the effect of PC ownership on college GPA. (i) Run the regression colGPA on PC, hsGPA, and...
-
The local summer baseball league wants to buy new uniforms for its teams. The current uniforms are quite old and will require $400 in repairs before they can be handed out to players next week for...
-
Anne Sugar makes large ceramic pots for use in outdoor landscaping. She currently has two models, one square and the other round. Because of the size of Annes creations, only one pot can be fired in...
-
Solve the problem. An arch has the shape of half an ellipse. The equation of the ellipse is 100x 2 + 324y 2 = 32,400, where x and y are in meters. (a) How high is the center of the arch? (b) How wide...
-
A block of mass m = 2 kg goes down an inclined plane that makes an angle of 0=30 with the horizontal. The coefficient of friction between the surfaces of the block and the inclined plane is u=0.2. At...
-
MEGAFRAME COMPUTER COMPANY Balance Sheet As of December 31 ASSETS Cash $ 50,000 Accounts receivable 70,000 Inventory 110,000 Net plant and equipment 220,000 Total assets $ 450,000 LIABILITIES AND...
-
1. An economy produces two products, timber (T) and fish (F), according to the production possibilities table below. The usual assumptions apply. a) Plot the data from the production possibilities...
-
Prvoide detail explanation Which project will you realize? Net Present Value Calculation You manage a small company producing plastic pallets. Your (business) customers are companies using plastics...
-
1. Study the PPC diagram below and answer the questions that follow: Switzerland's PPC (chocolate and watches) Chocolate (millions of bars) 54 3 7 2 68 B X Z O 1 2 3 4 5 6 7 8 9 Watches (thousands)...
-
SAP is a German multinational specializing in enterprise application software. The company was founded by five engineers, and the company is now the world's leading business software maker. Through...
-
Which of the following gives the range of y = 4 - 2 -x ? (A) (- , ) (B) (- , 4) (C) [- 4, ) (D) (- , 4] (E) All reals
-
Maria is a 26-year-old sales rep for a technology company. She lives in a two-bedroom townhouse with her golden retriever Rex. Maria travels about twice a month, and when doing so, she has three...
-
Information on four investment proposals is given below: Required: 1. Compute the project profitability index for each investment proposal. 2. Rank the proposals in terms of preference. Investment...
-
Information on four investment proposals is given below: Required: 1. Compute the project profitability index for each investment proposal. 2. Rank the proposals in terms of preference. Investment...
-
The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Required: 1. Determine the payback period of the investment. 2. Would...
-
Do you envision the business as starting by targeting specific needs of a single target community (e.g. the target is San Francisco), targeting specific needs of a similar set of communities (e.g....
-
Define social media. ( 20 points ) How has social media changed the way marketers and consumers communicate with one another? Explain the implications for marketers. Describe how marketing managers...
-
Find an article or video offering advice on choosing the best financing option for a business. Answer the following questions: Which types of financing did they discuss? What advice did they offer?...
Study smarter with the SolutionInn App