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Differentis Alysis for a Discontinued Product A condensed income statement by product line for british...

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Differentis Alysis for a Discontinued Product A condensed income statement by product line for british Beverage Inc. vidicated the following for Royal Cola for the past year Sales $232,500 Cost of goods sold 106,000 Gross profit $124,500 Operating expenses 145,000 Last from operations $(20,500) It is estimated that 15% of the cost of goods sold represents fixed factory overhead costs and that 23% of the operating expenses are fixed. Since Royal Cols is only one of many products, the Fixed costs will not be materialy affected the product is discontinued a. Prepare a differential analysis, dated March 3, to determine whether Royal Cola should be continued (Alternative 1) or continued (Alternative 2). If an amount is zero, entercero ou a minus sign to indicate a loss Differential Analysis Continue Royal Cola (Alt. 1) or Discontinue Royal Cola (Alt. 2) January 21 Differential Effect Continue Royal Discontinue Royal Cola (Alternative 1) Cola (Alternative 2) on Income (Alternative 2) Revenues Cos Variable cost of goods sold Vanable operating expenses Fixed costs Income (L. b. Should Colbertained if the product is discontinued As indicated by the differential analys in part (A), the income would

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