The income statement for Nighty Night, Inc is divided into two product lines, blankets and pillows, as follows

Blankets Pillows Total
Sales revenue $800,000 $510,000 $1,310,000
Variable costs 450,000 440,000 890,000
Contribution margin 350,000 70,000 420,000
Fixed costs 65,000 96,000 161,000
Operating income (loss) $285,000 $(26,000 ) $259,000

Nighty Night, Inc should eliminate the pillows product line only, if by doing so, they can eliminate more than $70,000 of fixed costs.
Indicate whether the statement is true or false


TRUE

Business

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Indicate whether the statement is true or false.

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An example of a contractual vertical marketing system is ________.

A. stocking B. franchising C. retailing D. wholesaling E. e-tailing

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Refer to the following selected financial information from Texas Electronics. Compute the company's days' sales in inventory for Year 2. (Use 365 days a year.) Year 2 Year 1Cash$37,500 $36,850 Short-term investments 90,000  90,000 Accounts receivable, net 85,500  86,250 Merchandise inventory 121,000  117,000 Prepaid expenses 12,100  13,500 Plant assets 388,000  392,000 Accounts payable 113,400  111,750 Net sales 711,000  706,000 Cost of goods sold 390,000  385,500 

A. 42.3. B. 46.2. C. 113.2. D. 80.0. E. 43.9.

Business

"The last three years of severe drought conditions have been brutal to our lawn care business. We survived, but our business is too concentrated," said Rocco Camanetti, owner of Camanetti & Sons. "I propose that we expand in new areas-trucking, catering, and dry cleaning-to minimize our risks due to market fluctuations in one industry." Rocco is advocating a(n) ________ strategy.

A. horizontal integration B. related diversification C. lateral integration D. unrelated diversification E. vertical integration

Business