Marin Company makes several products, including canoes. The company reports a loss from its canoe segment...

 

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Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All variable costs are avoidable, and $330,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,097,600 784,000 313,600 376,000 $ (62,400) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated? Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All variable costs are avoidable, and $330,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,097,600 784,000 313,600 376,000 $ (62,400) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated?

Answer rating: 100% (QA)

a To compute the income increase or decrease from eliminating the segment you would need to compare ... View the full answer