Suppose Grainy Day is considering discontinuing its coco crispies product Ine. Assume that during the...
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Suppose Grainy Day is considering discontinuing its coco crispies product Ine. Assume that during the past year, the coco crispies' product line income staternent showed the following: If the company decides to discontinue the product line, what will happen to the company/s operating income? Should Grainy Day discontinue the coco crispies product line? Begin by preparing a contribution margin income stalement for the coco crispies' product line. (Use a minus sign or parentheses to enter a loss.) Income statement data Additional information Foced manutacturing overthead costs account for 40% of the cost of goods, while only 30% of the operating expenses are foxed. Since the coco crispies line is just one of the company's cereal operations, only $730,000 of direct fixed costs (the majority of which is advertising) wil be eliminated if the product line is discontinued. The remainder of the fixed costs will stil be incurred by the company
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