THALASSINES KATASKEVES, SA Income Statement-Bilge Pump For the Quarter Ended March 31 Sales €950,000 Less: Variable expenses: Variable manufacturing expenses €340,000 Sales commissions 46,000 Shipping 14,000 Total variable expenses 400,000 Contribution margin 550,000 Less: Fixed expenses: Advertising 290,000 Depreciation of equipment (no resale value) 90,000 General factory overhead 115,000* Salary of product-line manager 38,000 Insurance on inventories 18,000 Purchasing department expenses 65.000' Total fixed expenses 616.000 Net operating loss E166.000) "Common costs allocated on the basis of machine-hours "Common costs allocated on the basis of sales dollars The currency in Greece is the euro, denoted by €. The discontinuance of the bilge pump product line would not affect sales of other produ lines and would have no noticeable effect on the company's total general factory overhead or total purchasing department expenses.

THALASSINES KATASKEVES, SA Income Statement-Bilge Pump For the Quarter Ended March 31 Sales €950,000 Less: Variable expenses: Variable manufacturing expenses €340,000 Sales commissions 46,000 Shipping 14,000 Total variable expenses 400,000 Contribution margin 550,000 Less: Fixed expenses: Advertising 290,000 Depreciation of equipment (no resale value) 90,000 General factory overhead 115,000* Salary of product-line manager 38,000 Insurance on inventories 18,000 Purchasing department expenses 65.000' Total fixed expenses 616.000 Net operating loss E166.000) "Common costs allocated on the basis of machine-hours "Common costs allocated on the basis of sales dollars The currency in Greece is the euro, denoted by €. The discontinuance of the bilge pump product line would not affect sales of other produ lines and would have no noticeable effect on the company's total general factory overhead or total purchasing department expenses.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter8: Revenue Recognition, Receivables, And Advances From Customers

Section: Chapter Questions

Problem 32E

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10 ts Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 6 General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. tCommon costs allocated on the basis of sales dollars. $ 139,000 55,000 22,000 29,000 107,000 Answer is not complete. $ 95,000 X 43,000* 126,000 13,000 47,000+ Required: What is the financial advantage (disadvantage) of…
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