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  3. a condensed income statement for csb refrigeration

A condensed income statement for CSB Refrigeration for Model TS9 for the past year is...

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Accounting

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A condensed income statement for CSB Refrigeration for Model TS9 for the past year is as follows: Sales = $ 600,000 Cost of goods sold = (400,000) Gross Profit $ 200,000 Operating Expenses- $ (230,000) Operating income $ (30,000). It is estimated that 45% of the cost of goods sold represents fixed factory overhead costs and that 60% of the operating expenses are fixed. Model TS9 is one of many products that are produced and therefore, fixed costs will not be materially affected if management decides to discontinue the product. Question: Should Model TS9 be discontinued or retained? How much richer or poorer will CSB be by making the correct decision? Retain, $313,500 Poorer Discontinue, $288,000 Richer Discontinue, $30,000 Richer Retain, $288,000 Richer

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