Tyler Corporation has provided you with the following budgeted income statement for one of its products:
Tyler Corporation believes that 80% of the fixed costs would be avoidable if the product line was dropped.Based on the impact of company's operating income,Tyler should not drop the product line.

Question

Tyler Corporation has provided you with the following budgeted income statement for one of its products:
  Tyler Corporation believes that 80% of the fixed costs would be avoidable if the product line was dropped.Based on the impact of company's operating income,Tyler should not drop the product line.

Quizplus · Accepted Answer

11ea84d1_118c_263b_83dc_7da38261c0d4_TB3006_00 As operating loss is less than unavoidable fixed costs,the company must continue to operate.

Tyler Corporation Has Provided You with the Following Budgeted Income