Macho Sports Company sells soccer and baseball merchandise. The company is trying to decide whether or...

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Macho Sports Company sells soccer and baseball merchandise. The company is trying to decide whether or not to continue the baseball merchandise given the decline in the demand and current loss of this product line. The following information is available for the segments: Baseball Soccer Sales $120,000 $420,000 Variable costs 72,000 220,000 Contribution margin 48,000 200,000 Direct fixed costs 32,000 70,000 Allocated common fixed 20,000 70,000 costs Net income ($4,000) $60,000 If the baseball segment is dropped, soccer sales will be unaffected. What will be the effect on overall profits if the baseball segment is eliminated? O Overall profits will increase $4,000. O Overall profits will decrease by $120,000. O Overall profits will decrease by $48,000. O Overall profits will decrease by $16,000. h Macho Sports Company sells soccer and baseball merchandise. The company is trying to decide whether or not to continue the baseball merchandise given the decline in the demand and current loss of this product line. The following information is available for the segments: Baseball Soccer Sales $120,000 $420,000 Variable costs 72,000 220,000 Contribution margin 48,000 200,000 Direct fixed costs 32,000 70,000 Allocated common fixed 20,000 70,000 costs Net income ($4,000) $60,000 If the baseball segment is dropped, soccer sales will be unaffected. What will be the effect on overall profits if the baseball segment is eliminated? O Overall profits will increase $4,000. O Overall profits will decrease by $120,000. O Overall profits will decrease by $48,000. O Overall profits will decrease by $16,000. h

Answer rating: 100% (QA)

Option D Cument net income is 60000 4000 56000 If Baseball segment is eliminated ... View the full answer