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Author Question: Pottery Unlimited has two product lines: cups and pitchers. Income statement data for the most ... (Read 79 times)

lilldybug07

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Pottery Unlimited has two product lines:  cups and pitchers.  Income statement data for the most recent year follow:

TotalCupsPitchers
Sales revenue$460,000$310,000$150,000
Variable expenses355,000235,000120,000
Contribution margin105,00075,00030,000
Fixed expenses76,00038,00038,000
Operating income (loss)$29,000$37,000$(8,000)


Assuming Pottery Unlimited's fixed costs remain unchanged, how would dropping the Pitcher line affect operating income?
◦ Decrease in total operating income of $22,000
◦ Decrease in total operating income of $1,000
◦ Increase in total operating income of $8,000
◦ Decrease in total operating income of $30,000


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Marked as best answer by lilldybug07 on Jan 4, 2020

paavo

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lilldybug07

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Reply 2 on: Jan 4, 2020
Gracias!


apple

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Reply 3 on: Yesterday
Wow, this really help

 

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