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Business, 08.05.2021 01:00 Paigex3

The condensed product-line income statement for Rhinebeck Company for the month of October is as follows: Rhinebeck Company
Product-Line Income Statement
For the Month Ended October 31
Hats Gloves Mufflers
Sales $71,000 $105,700 $45,000
Cost of goods sold (32,600) (42,300) (27,000)
Gross profit $38,400 $63,400 $18,000
Selling and administrative27400 (42,800) (25000)
expenses
Operating income (loss) $11,000 (20,600) $(7,000) Fixed costs are 20% of the cost of goods sold and 30% of the selling and administrative expenses. Rhinebeck Company assumes that fixed costs would not be materially affected if the Gloves line were discontinued.
Prepare a differential analysis dated October 31 to determine if Mufflers should be continued (Alternative 1) or discontinued (Alternative 2).

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The condensed product-line income statement for Rhinebeck Company for the month of October is as fol...
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