Question: Shown below is a segmented income statement for Hickory Company's three wooden flooring product lines Strip Plank Parquet Total Sales revenue 5400,000 $200,000 $300,000 $900,000

 Shown below is a segmented income statement for Hickory Company's three

Shown below is a segmented income statement for Hickory Company's three wooden flooring product lines Strip Plank Parquet Total Sales revenue 5400,000 $200,000 $300,000 $900,000 Less: Variable expen 225,000 120,000 250,000 595,000 Corbution to 5175.000 $ 60,000 $50,000 $305,000 Less directed expenses Machine rent (5,000) (20,000) (50,000) 75,000) Supervision (15,000) (10,000) (20,000) (45,000) Depreciation (35,000 (10,000) 125,000) 70,000) Segment margin $120,000 $ 40,000 $(45.000) 5115,000 Fickory's management is deading whether to keep or drop the parquet product line. Hickory's parguetting product line has a contribution margin of $50,000 (sales of $300,000 best tal variable costs of $250,000). Al variable costs are relevant Selevant fixed Costonated with the line code of panet's machine and all of poet's supervision series. In addition, that dropping the prout product Nice would sales of the strip line by 10% and sales of the planine By All other information the same Required: 1. If the arget productes dropped what the contribution maron for the line for the

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!