The following information is for X Company's two products - A and B: Product A...
50.1K
Verified Solution
Link Copied!
Question
Accounting
The following information is for X Company's two products - A and B:
Product A Product B Revenue $90,000 $85,000 Variable Costs 46,800 49,300 Fixed costs $55,530 $28,190 Profit $-12,330 $7,510
$9,440 of Product A's fixed costs are directly related to Product A; $4,792 of Product B's fixed costs are directly related to Product B. All other fixed costs are allocated to the individual products. X Company is considering droping Product A because of its reported loss
If it drops Product A, what will be the effect on firm profits? A: $-21,606 B: $-27,008 C: $-33,760 D: $-42,200 E: $-52,750 F: $-65,937
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
