Tyler Corporation has provided you with the following budgeted income statement for one of its products:

Tyler Corporation believes that 75% of the fixed costs would be avoidable if the product line was dropped.Based on the impact on the company's operating income or loss,Tyler should keep the product line.

Question

Tyler Corporation has provided you with the following budgeted income statement for one of its products:
  
Tyler Corporation believes that 75% of the fixed costs would be avoidable if the product line was dropped.Based on the impact on the company's operating income or loss,Tyler should keep the product line.

Quizplus · Accepted Answer

11ea8a42_4fbc_f6aa_8b44_314231cb22ac_TB5024_00 Because operating loss is less than unavoidable fixed costs,the company must continue to operate.

Tyler Corporation Has Provided You with the Following Budgeted Income