ABC Company sells three products. Income statements for the three products for the mostrecent year appear below:
Product A Product B Product C
Sales revenue ...................... $120,000 $180,000 $145,000
Costs: Variable costs ................. 78,000 54,000 87,000
Advertising .................... 10,000 7,000 8,000 Rent ........................... 10,000 10,000 10,000 Supervisor's salary ............ 25,000 35,000 30,000 Property taxes ................. 12,000 6,000 2,000
Net income/loss ..................... <15,000> 68,000 8,000The rent is allocated to the three products equally and the property taxes are allocatedbased on the square footage each product uses in the factory.The president of the company is considering eliminating Product
A. Calculate the decrease in company profits if Product A is dropped. Do not use decimals ortype the word decrease after your answer.
Additionally, do not enter your answer with aminus sign in front of the number.