Required: Bravo wants to know the effect on Net Income if it decides to discontinue the Fruit & Nuts product.
If Bravo eliminates Fruit & Nuts 50% of fixed costs can be avoided.
Prepare and incremental analysis showing the Net Income Effect of eliminating the Fruit & Nuts product.
What woud you advise Bravo to do?
Using the Table below compute the Net Income for Bravo Baking after eliminating the Fruit & Nuts product.
Product Hi-Lo Whole Grain Fruit & Nuts Total
Revenues 0
Variable product costs 0
Variable Selling & Administrative costs 0
Contribution Margin 0
Fixed Product Costs 0
Fixed Selling and Administrative Costs 0
Allocated Common Costs 0
Net Income 0