Suppose K-Log is considering discontinuing its special oats product line. Assume that during the past year,...

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Suppose K-Log is considering discontinuing its special oats product line. Assume that during the past year, the special oats' product line income statement showed the following: m (Click the icon to view the income statement data.) (Click the loon for additional Information. t the company decides to discontinue the product line, what will happen to the company's operating income? Should K-Log disoontinue the special oats product line? Begin by preparing a contribution margin income statement for the special oats' product line. (Use a minus sign or parentheses to enter a lons.) Sales revenue Less: Contribution margin O Data Table Less Sales revenue %24 5,250,000 Operating income (loss) 6,150,000 Less: Cost of goods sold (000.000) 1,500,000 More Info Gross profit Less: Operating expenses Operating income (loss) $(2,400,000) Flxed manufacturing overhead costs account for 40% of the cost of goods, whtie only 30% of the operating expennes are fixed. Since the special oats line is just one of the company's cereal operations, only $770,000 of direct fixed costs (the majority of which le advertising) will be eliminated if the product line in diecontinued. The remainder of the fixed costs will still be inourred by the company Print Done Print Done Suppose K-Log is considering discontinuing its special oats product line. Assume that during the past year, the special oats' product line income statement showed the following: m (Click the icon to view the income statement data.) (Click the loon for additional Information. t the company decides to discontinue the product line, what will happen to the company's operating income? Should K-Log disoontinue the special oats product line? Begin by preparing a contribution margin income statement for the special oats' product line. (Use a minus sign or parentheses to enter a lons.) Sales revenue Less: Contribution margin O Data Table Less Sales revenue %24 5,250,000 Operating income (loss) 6,150,000 Less: Cost of goods sold (000.000) 1,500,000 More Info Gross profit Less: Operating expenses Operating income (loss) $(2,400,000) Flxed manufacturing overhead costs account for 40% of the cost of goods, whtie only 30% of the operating expennes are fixed. Since the special oats line is just one of the company's cereal operations, only $770,000 of direct fixed costs (the majority of which le advertising) will be eliminated if the product line in diecontinued. The remainder of the fixed costs will still be inourred by the company Print Done Print Done