The Management of Kabanuck Corporation Is Considering Dropping Product V41B

question 133

Multiple Choice

The management of Kabanuck Corporation is considering dropping product V41B. Data from the company's accounting system appear below:

All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $184,000 of the fixed manufacturing expenses and $200,000 of the fixed selling and administrative expenses are avoidable if product V41B is discontinued.
-What would be the effect on the company's overall net operating income if product V41B were dropped?

• A)Overall net operating income would increase by $71,000.
• B)Overall net operating income would increase by $132,000.
• C)Overall net operating income would decrease by $132,000.
• D)Overall net operating income would decrease by $71,000.

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Recognize that personality and cognitive abilities can change and develop across a lifespan.

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Definitions:

Seasonal Allergies

Allergic reactions to airborne substances such as pollen, that occur during specific seasons causing symptoms like sneezing and congestion.

Viral Illness

Illnesses caused by viruses, which are microscopic infectious agents that can lead to a wide range of diseases, from the common cold to more severe illnesses.

Carbohydrate-containing Liquids

Liquids that include sugars or substances that can be broken down into sugars, providing energy to the body.

Adsorbents

Materials that bind molecules from a gas or liquid onto their surface.