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Decision to Discontinue a ProductOn the basis of the following data, the general manager of...

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Accounting

Decision to Discontinue a ProductOn the basis of the following data, the general manager of Foremost Footwear Inc. decided to discontinue Childrens Shoes because it reduced income from operations by $10,000. What is the flaw in this decision if it is assumed that fixed costs would not be materially affected by the discontinuance?eBook
Foremost Footwear Inc.
Product-Line Income Statement
for the Year Ended April 30,20 Y7
\table[[,\table[[Children's],[Shoes]],\table[[Men's],[Shoes]],\table[[Women's],[Shoes]],Total],[Sales,$165,000,$300,000,$500,000,$965,000
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