Eliminating operations – Capital Toys’ management is considering eliminating

Posted: December 30th, 2021

ABCTotalSales revenue$2,200$1,400$1,800$5,400Variable expenses1,6506001,0803,330Contribution margin$ 550$ 800$ 720$2,070Advertisinga expense$ 500$ 475$ 520$1,495Depreciation expense15102045Corporate expenses9080105275Total fixed expenses$ 605$ 565$ 645$1,815Operating income$ (55)$ 235$ 75$ 255aSpecific to each product.Specific to each product; no other use available, no resale value.Allocated based on number of employees.