The following information is for X Company's two products - A and B: Product A...
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Accounting
The following information is for X Company's two products - A and B:
Product A Product B Revenue $90,000 $85,000 Variable Costs 46,800 49,300 Fixed costs $55,530 $28,190 Profit $-12,330 $7,510
$9,440 of Product A's fixed costs are directly related to Product A; $4,792 of Product B's fixed costs are directly related to Product B. All other fixed costs are allocated to the individual products. X Company is considering droping Product A because of its reported loss
If it drops Product A, what will be the effect on firm profits? A: $-21,606 B: $-27,008 C: $-33,760 D: $-42,200 E: $-52,750 F: $-65,937
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