A Company Has Two Different Products That Sell to Separate

question 32

True/False

A company has two different products that sell to separate markets.Financial data are as follows:
$$\begin{array} { | l | r | r | r | } \hline & \text { Product A } & \text { Product B } & { \text { Total } } \\\hline \text { Revenue } & \$ 12000 & \$ 8000 & \$ 20000 \\\hline \text { Variable cost } & ( \$ 7500 ) & ( \$ 8100 ) & ( \$ 15600 ) \\\hline \text { Fixed cost (allocated) } & ( \$ 3000 ) & ( \$ 1000 ) & ( \$ 4000 ) \\\hline \text { Profit } & \$ 1500 & ( \$ 1100 ) & \$ 400 \\\hline\end{array}$$
Assume that fixed costs are all unavoidable and that dropping one product would not impact sales of the other.Because the contribution margin of Product B is negative,it should be dropped.

---

Definitions:

White Rami Communicantes

Nerve fibers connecting the spinal nerves to the sympathetic chain, important for the sympathetic nervous system's responses.

Preganglionic Axons

Axons of nerve cells that originate in the central nervous system and extend to a ganglion, transmitting nerve impulses.

Sympathetic Chain

A part of the sympathetic nervous system consisting of a series of interconnected ganglia located along the vertebral column.

ANS

Autonomic Nervous System; a control system that acts largely unconsciously and regulates bodily functions such as the heart rate, digestion, respiratory rate, pupillary response, urination, and sexual arousal.