Top managers of Advanced Data Manufacturing are alarmed by their operating losses.They are considering dropping the desktop product line.The company accountants have prepared the following analysis to help make this decision.

If the company stops selling the desktop product line,the company will be able to avoid 80% of the fixed manufacturing costs and 100% of the fixed selling and administrative costs.
Prepare a differential analysis to show whether Advanced Data Manufacturing should drop the desktop product line.Should the desktop product line be dropped? Explain your answer.

Question

Top managers of Advanced Data Manufacturing are alarmed by their operating losses.They are considering dropping the desktop product line.The company accountants have prepared the following analysis to help make this decision.

If the company stops selling the desktop product line,the company will be able to avoid 80% of the fixed manufacturing costs and 100% of the fixed selling and administrative costs.
Prepare a differential analysis to show whether Advanced Data Manufacturing should drop the desktop product line.Should the desktop product line be dropped? Explain your answer.

Quizplus · Accepted Answer

The Answer of Top managers of Advanced Data Manufacturing are alarmed by their operating losses.They are considering dropping the desktop product line.The company accountants have prepared the following analysis to help make this decision.

If the company stops selling the desktop product line,the company will be able to avoid 80% of the fixed manufacturing costs and 100% of the fixed selling and administrative costs.
Prepare a differential analysis to show whether Advanced Data Manufacturing should drop the desktop product line.Should the desktop product line be dropped? Explain your answer.

Top Managers of Advanced Data Manufacturing Are Alarmed by Their