1. If the company had dropped the 300 series as of January 1, 2000, what effect that action would have had on the profit for the first six months of 2000?
INCREMENTAL
ANALYSIS
"KEEP
OR
DROP"
THE
300
SERIES
LINE
100
series
(pcs)
allocated
Proportion
for
Unit
Sales
Allocated
Unit
Sales
(100
pcs)
0.45
997,538.0
100
series
(000'$)
allocated
Labor
Raw
Materials
Power
Repairs
Rent
Other
Factory
Cost
200
series
(pcs)
allocated
0.32
712,587.0
200
series
(000'$)
allocated
Option
(1-‐"keep";
2-‐"drop")
300
series
(pcs)
allocated
1,710,125.00
Short-‐term
606.70
616.88
10.42
8.81
78.04
59.62
0.608
0.618
0.010
0.009
0.078
0.060
424.06
527.91
...