Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. blowing sand company produces the drafty model fan

Blowing Sand Company produces the Drafty model fan, which currently has a net loss of...

70.2K

Verified Solution

Question

Accounting

Blowing Sand Company produces the Drafty model fan, which currently has a net loss of $39,000 as follows:

Drafty Model
Sales revenue $ 160,000
Less: Variable costs 112,000
Contribution margin $ 48,000
Less: Direct fixed costs 41,000
Segment margin $ 7,000
Less: Common fixed costs 46,000
Net operating income (loss) $ (39,000)

Eliminating the Drafty product line would eliminate $41,000 of direct fixed costs. The $46,000 of common fixed costs would be redistributed to Blowing Sands remaining product lines. Will Blowing Sands net operating income increase or decrease if the Drafty model is eliminated? By how much?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Statistics
1.2K views

The observations are listed : 5.32, 9.87, 11.25, 10.94, 5.58, 6.29, 7.47, 10.75, 6.22, 8.00. Apply...

Psychology
1.2K views

Reflective summary on Chapters 3 and 4 of the book Principles of Health Behavior by Edberg

Basic Math
1.2K views

Is there a way to do this without the binomial probability? Consider the following game: You...

Physics
1.2K views

In Young s double slit experiment green light with wavelength 5500 is used and 60...

Geometry
1.2K views

you have completed the above problems and checked your solutions complete the Lesson Checkpoint below...

Basic Math
1.2K views

dath 1111 Te wh Question 19 1 point Analyze the graph of the function R...

Algebra
1.2K views

Use elementary row operations to obtain an upper triangular matrix 5 10 15 6 19...

Algebra
1.2K views

Step 1 of 4 Find the vertex of this function y x 4 3

Accounting
1.2K views

you are currently trying to decide between two cost structures for your business: one that...

Accounting
1.2K views

Tony's Lawn Equipment sells high-quality lawn mowers and offers a 3-year warranty on all new...

Accounting
1.2K views

In 2023, Tom and Alejandro Jackson (married filing jointly) have $200,000 of taxable income before...

Accounting
1.2K views

- Wages eccrued but not paid at July 31,$4,840, Required: 1. Joumalize the six adjusting...