Question

Lisah, Inc., manufactures golf clubs in three models. For the
year, the Big Bart line has a net loss of $10,000 from sales
$200,000, variable costs $180,000, and fixed costs $30,000. If the
Big Bart line is eliminated, $20,000 of fixed costs will remain.
Prepare an analysis showing whether the Big Bart line should be
eliminated. *(Enter negative amounts using either a
negative sign preceding the number e.g. -45 or parentheses e.g.
(45).)*

Continue |
Eliminate |
Net IncomeIncrease (Decrease) |
|||||
---|---|---|---|---|---|---|---|

Sales | $enter sales in dollars | $enter sales in dollars | $enter sales in dollars | ||||

Variable costs | enter variable costs in dollars | enter variable costs in dollars | enter variable costs in dollars | ||||

Contribution margin | enter a subtotal of the two previous amounts | enter a subtotal of the two previous amounts | enter a subtotal of the two previous amounts | ||||

Fixed costs | enter fixed costs in dollars | enter fixed costs in dollars | enter fixed costs in dollars | ||||

Net Income / (Loss) | $enter net income or loss in dollars | $enter net income or loss in dollars | $enter net income or loss in dollars |

The Big Bart product line should be select an option
continuedeliminated . |

Answer #1

Gator Corporation manufactures several types of accessories. For
the year, the gloves and mittens line had sales of $501,000,
variable expenses of $367,000, and fixed expenses of $149,000.
Therefore, the gloves and mittens line had a net loss of $15,000.
If Gator eliminates the line, $38,000 of fixed costs will remain.
Prepare an analysis showing whether the company should eliminate
the gloves and mittens line. (Enter negative amounts using either a
negative sign preceding the number e.g. -45 or parentheses...

Veronica Mars, a recent graduate of Bell’s accounting program,
evaluated the operating performance of Dunn Company’s six
divisions. Veronica made the following presentation to Dunn’s board
of directors and suggested the Percy Division be eliminated. “If
the Percy Division is eliminated,” she said, “our total profits
would increase by $26,600.”
The
Other
Five Divisions
Percy
Division
Total
Sales
$1,664,000
$100,000
$1,764,000
Cost of goods
sold
978,000
76,900
1,054,900
Gross profit
686,000
23,100
709,100
Operating
expenses
526,300
49,700
576,000
Net income...

Veronica Mars, a recent graduate of Bell’s accounting program,
evaluated the operating performance of Dunn Company’s six
divisions. Veronica made the following presentation to Dunn’s board
of directors and suggested the Percy Division be eliminated. “If
the Percy Division is eliminated,” she said, “our total profits
would increase by $25,500.”
The Other
Five Divisions
Percy
Division
Total
Sales
$1,663,000
$100,000
$1,763,000
Cost of goods sold
977,000
76,000
1,053,000
Gross profit
686,000
24,000
710,000
Operating expenses
526,000
49,500
575,500
Net income...

Veronica Mars, a recent graduate of Bell’s accounting program,
evaluated the operating performance of Dunn Company’s six
divisions. Veronica made the following presentation to Dunn’s board
of directors and suggested the Percy Division be eliminated. “If
the Percy Division is eliminated,” she said, “our total profits
would increase by $27,100.”
The Other
Five Divisions
Percy
Division
Total
Sales
$1,665,000
$100,100
$1,765,100
Cost of goods sold
978,700
76,700
1,055,400
Gross profit
686,300
23,400
709,700
Operating expenses
528,700
50,500
579,200
Net income...

Veronica Mars, a recent graduate of Bell’s accounting program,
evaluated the operating performance of Dunn Company’s six
divisions. Veronica made the following presentation to Dunn’s board
of directors and suggested the Percy Division be eliminated. “If
the Percy Division is eliminated,” she said, “our total profits
would increase by $26,900.”
The Other
Five Divisions
Percy
Division
Total
Sales
$1,665,000
$100,600
$1,765,600
Cost of goods sold
978,700
77,000
1,055,700
Gross profit
686,300
23,600
709,900
Operating expenses
527,200
50,500
577,700
Net income...

Question 4
Gator Corporation manufactures several types of accessories. For
the year, the gloves and mittens line had sales of $495,000,
variable expenses of $363,000, and fixed expenses of $148,000.
Therefore, the gloves and mittens line had a net loss of $16,000.
If Gator eliminates the line, $39,000 of fixed costs will remain.
Prepare an analysis showing whether the company should eliminate
the gloves and mittens line. (Enter negative amounts
using either a negative sign preceding the number e.g. -45...

Veronica Mars, a recent graduate of Bell’s accounting program,
evaluated the operating performance of Dunn Company’s six
divisions. Veronica made the following presentation to Dunn’s board
of directors and suggested the Percy Division be eliminated. “If
the Percy Division is eliminated,” she said, “our total profits
would increase by $26,300.”
The Other
Five Divisions Percy
DivisionTotalSales$1,663,000$101,000$1,764,000Cost
of goods sold979,00076,900 1,055,900Gross profit684,00024,100
708,100Operating expenses528,10050,400 578,500Net income$155,900$
(26,300)$129,600
In the Percy Division, cost of goods sold is $60,400 variable and
$16,500 fixed,...

The following CVP income statements are available for Blanc
Company and Noir Company. Blanc Company Noir
Company Sales $455,000 $455,000 Variable costs 273,000 227,500
Contribution margin 182,000 227,500 Fixed costs 159,250 204,750 Net
income $22,750 $22,750
Assuming that sales revenue increases by 20%, prepare a CVP
income statement for each company. (Enter negative
amounts using either a negative sign preceding the number e.g. -45
or parentheses e.g. (45).)
Blanc Company
Noir Company
Sales
$Enter a dollar amount
$Enter a dollar...

McGilla Golf has decided to sell a new line of golf clubs. The
clubs will sell for $820 per set and have a variable cost of $420
per set. The company has spent $152,000 for a marketing study that
determined the company will sell 56,000 sets per year for seven
years. The marketing study also determined that the company will
lose sales of 9,700 sets of its high-priced clubs. The high-priced
clubs sell at $1,120 and have variable costs of...

McGilla Golf has decided to sell a new line of golf clubs. The
clubs will sell for $770 per set and have a variable cost of $370
per set. The company has spent $147,000 for a marketing study that
determined the company will sell 59,000 sets per year for seven
years. The marketing study also determined that the company will
lose sales of 9,200 sets of its high-priced clubs. The high-priced
clubs sell at $1,070 and have variable costs of...

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