Question

The condensed product-line income statement for Dinner Ware Company for the month of August is as follows:


Fixed costs are 40% of the cost of goods sold and 18% of the selling and administrative expenses. Dinner Ware assumes that fixed costs would not be significantly affected if the Cups line were discontinued.
a. Prepare a differential analysis report for all three products for the month ended August 31, 2012.
b. Should the Cups line be retained?Explain.


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  • CreatedFebruary 04, 2014
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