Problem 2 (Eliminate or Retain a Product Line) Crystal Sports Equipment manufactures round, rectangular, and octagonal trampolines. Data on sales and expenses for the past month follow: Total P1,000,000 410,000 590,000 Round P140,000 60,000 80,000 Trampoline Rectangular Octagonal P500,000 200,000 300,000 Sales. Less variable expenses. Contribution margin. Less fixed expenses: Advertising – traceable Depreciation of special equipment Line supervisors' salaries... General factory overhead* Total fixed expenses Net operating income (loss). P360,000 150,000 210,000 216,000 95,000 19,000 200,000 530,000 P 60,000 41,000 20,000 6,000 28,000 95,000 P(15,000) 110,000 40,000 7,000 100,000 257,000 P 43,000 65,000 35,000 6,000 72,000 178,000 P 32,000 * A common fixed cost that is allocated on the basis of sales pesos.

Problem 2 (Eliminate or Retain a Product Line) Crystal Sports Equipment manufactures round, rectangular, and octagonal trampolines. Data on sales and expenses for the past month follow: Total P1,000,000 410,000 590,000 Round P140,000 60,000 80,000 Trampoline Rectangular Octagonal P500,000 200,000 300,000 Sales. Less variable expenses. Contribution margin. Less fixed expenses: Advertising – traceable Depreciation of special equipment Line supervisors' salaries... General factory overhead* Total fixed expenses Net operating income (loss). P360,000 150,000 210,000 216,000 95,000 19,000 200,000 530,000 P 60,000 41,000 20,000 6,000 28,000 95,000 P(15,000) 110,000 40,000 7,000 100,000 257,000 P 43,000 65,000 35,000 6,000 72,000 178,000 P 32,000 * A common fixed cost that is allocated on the basis of sales pesos.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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