Keith Inc. has 4 product lines: sour cream, ice cream, yogurt, and butter. The allocated fixed costs are based on units sold and are unavoidable. Demand of individual products is not affected by changes in other product lines. 40% of the fixed costs are direct, and the other 60% are allocated. Results of June follow:
Instructions
Prepare an incremental analysis of the effect of dropping the sour cream product line.

Question

Keith Inc. has 4 product lines: sour cream, ice cream, yogurt, and butter. The allocated fixed costs are based on units sold and are unavoidable. Demand of individual products is not affected by changes in other product lines. 40% of the fixed costs are direct, and the other 60% are allocated. Results of June follow:  
Instructions
Prepare an incremental analysis of the effect of dropping the sour cream product line.

Quizplus · Accepted Answer

The Answer of Keith Inc. has 4 product lines: sour cream, ice cream, yogurt, and butter. The allocated fixed costs are based on units sold and are unavoidable. Demand of individual products is not affected by changes in other product lines. 40% of the fixed costs are direct, and the other 60% are allocated. Results of June follow:  
Instructions
Prepare an incremental analysis of the effect of dropping the sour cream product line.

Keith Inc Has 4 Product Lines: Sour Cream, Ice Cream, Yogurt