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  • A Condensed Income Statement by Product Line For Garcia Beverages

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    Miroslav Gegoski
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    The document provides a condensed income statement for Melon Cola from Garcia Beverages Inc. for the past year. It shows sales of $3,750,000 with a gross profit of $1,500,000 but an operating loss of $300,000 after operating expenses of $1,800,000. It estimates that 20% of cost of goods sold and 35% of operating expenses are fixed costs, which would not be significantly affected by discontinuing Melon Cola.

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    A Condensed Income Statement by Product Line for Garcia Beverages

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    A Condensed Income Statement by Product Line for Garcia Beverages

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    The document provides a condensed income statement for Melon Cola from Garcia Beverages Inc. for the past year. It shows sales of $3,750,000 with a gross profit of $1,500,000 but an operating loss of $300,000 after operating expenses of $1,800,000. It estimates that 20% of cost of goods sold and 35% of operating expenses are fixed costs, which would not be significantly affected by discontinuing Melon Cola.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    11 views1 page

    A Condensed Income Statement by Product Line For Garcia Beverages

    Uploaded by

    Miroslav Gegoski
    The document provides a condensed income statement for Melon Cola from Garcia Beverages Inc. for the past year. It shows sales of $3,750,000 with a gross profit of $1,500,000 but an operating loss of $300,000 after operating expenses of $1,800,000. It estimates that 20% of cost of goods sold and 35% of operating expenses are fixed costs, which would not be significantly affected by discontinuing Melon Cola.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    A condensed income statement by product line for Garcia

    Beverages #8912
    A condensed income statement by product line for Garcia Beverages Inc. indicated the
    following for Melon Cola for the past year:Sales ............................................. $3,750,000Cost of
    goods sold ........................... (2,250,000)Gross profit .................................... $
    1,500,000Operating expenses ........................... (1,800,000)Operating loss .................................
    $ (300,000)It is estimated that 20% of the cost of goods sold represents fixed factory overhead
    costs and that 35% of the operating expenses are fixed. Since Melon Cola is only one of many
    products, the fixed costs will not be significantly affected if the product is discontinued.a.
    Prepare a differential analysis report for the proposed discontinuance of Melon Cola.b. Should
    Melon Cola be retained? Explain.View Solution:
    A condensed income statement by product line for Garcia Beverages

    ANSWER
    http://paperinstant.com/downloads/a-condensed-income-statement-by-product-line-for-garcia-
    beverages/

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