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Marinette Company makes several products, including canoes. The company has been experiencing losses from its...

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Accounting

Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe segment and is considering dropping that product line. The following information is available regarding its canoe segment.

MARINETTE COMPANY Income StatementCanoe Segment
Sales $ 3,900,000
Variable costs
Direct materials $ 830,000
Direct labor 880,000
Variable overhead 680,000
Variable selling and administrative 390,000
Total variable costs 2,780,000
Contribution margin 1,120,000
Fixed costs
Direct 755,000
Indirect 680,000
Total fixed costs 1,435,000
Net income $ (315,000 )

1. If canoes are discontinued, calculate the net income lost or gained. 2. Should management discontinue the manufacturing of canoes?

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Required 1 Required 2 Hint If canoes are discontinued, calculate the net income lost or gained. (Leave no cells blank. Enter Print Keep the department Eliminate the department Sales Expenses Total expenses Net income (loss) Required 2 >

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