Product AG52 has revenues of $195,600, variable cost of goodssold of $114,200, variable selling expenses of $31,600, and fixedcosts of $58,100, creating a loss from operations of $8,300.
a. Prepare a differential analysis as ofOctober 7 to determine if Product AG52 should be continued(Alternative 1) or discontinued (Alternative 2), assuming fixedcosts are unaffected by the decision. If an amount is zero, enter"0". Use a minus sign to indicate a loss.
| Differential Analysis |
| Continue Product AG52 (Alt. 1) or Discontinue Product AG52(Alt. 2) |
| October 7 |
| Continue Product AG52 (Alternative 1) | Discontinue Product AG52 (Alternative2) | Differential Effect on Income (Alternative2) |
| Revenues | $ | $ | $ |
| Costs: | | | |
| Variable cost of goods sold | | | |
| Variable selling expenses | | | |
| Fixed costs | | | |
| Income (Loss) | $ | $ | $ |
b. Determine if Product AG52 should becontinued (Alternative 1) or discontinued (Alternative 2).
