23 24 Q3. Harmark has three product lines in its retail stores: kites, wind socks, and flags. Results of the fourth quarter are presented below: 25 26 Units sold Kites Wind Soc Flags Total 1,000 2,000 2,000 5,000 $22,000 $40,000 $23,000 $85,000 27 Revenue 28 Variable departmental costs 17,000 22,000 12,000 51,000 29 Direct fixed costs 1,000 3,000 2,000 8,000 8,000 8,000 -$4,000 $7,000 $1,000 6,000 24,000 $4,000 30 Allocated fixed costs 31 Net income (loss) 32 33 The allocated fixed costs are unavoidable. Demand of individual products is not affected by changes in other product lines. 34 35 Instructions 36 What will happen to profits if Harmark discontinues the Kites product line? 37 38

The alocated fixed costs are unavoidable. Demand of individual products is not affected by changes in other product lines. instructions What wil happen to profits if Harmark discontinues the Kites product line