Cosco has three product lines in its retail stores: chips, pops and cheese and the financial...

Transcribed Image Text:

Cosco has three product lines in its retail stores: chips, pops and cheese and the financial are below: Chips Pops Cheese Total Units sold 1,000 2,000 2,000 5,000 Revenue $22,000 $40,000 $23,000 $85,000 Variable departmental costs 15,000 22,000 12,000 49,000 Direct fixed costs 9,000 11,000 10,000 30,000 Net income (loss) ($2,000) $7,000 $1.000 $6,000 If chips are dropped 40% of fixed cost is unavoidable, Should Cosco drop Chips? Cosco has three product lines in its retail stores: chips, pops and cheese and the financial are below: Chips Pops Cheese Total Units sold 1,000 2,000 2,000 5,000 Revenue $22,000 $40,000 $23,000 $85,000 Variable departmental costs 15,000 22,000 12,000 49,000 Direct fixed costs 9,000 11,000 10,000 30,000 Net income (loss) ($2,000) $7,000 $1.000 $6,000 If chips are dropped 40% of fixed cost is unavoidable, Should Cosco drop Chips?

Answer rating: 100% (QA)

No Cosco should not drop Chips Explanation If Cosco drops chips Revenue of Chips wil... View the full answer