Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. ken yalters, the coo of freshskin, asked his cost

Ken Yalters, the COO of FreshSkin, asked his cost management team for a product line...

80.2K

Verified Solution

Question

Accounting

Ken Yalters, the COO of FreshSkin, asked his cost management team for a product line profitability analysis for his firm's two products - Askin and Bskin. The two products are skin care products that require a large amount of research and development and advertising. He received the report below. Ken concluded that Askin was the more profitable product, and that perhaps cost-cutting measures should be applied to the Bskin product. Askin Bskin Total Sales $ 4,000,000 $ 2,600,000 $ 6,600,000 Cost of goods sold (2,600,000 ) (2,100,000 ) (4,700,000 ) Gross profit $ 1,400,000 $ 500,000 $ 1,900,000 Research and development (1,170,000 ) Selling expenses (130,000 ) Profit before taxes $ 600,000 Seventy-five percent of the research and development and selling expenses were traceable to Askin. Profit before taxes for the Bskin product, per life-cycle income statements, is: Answer could be: $425,000. $332,500. $522,500. $207,500. $175,000

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