Solution-What would clay profit margin be

What would clay profit margin be

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Reference no: EM132715578

Clay Inc. has two divisions, Myrtle and Laurel. Following is the income statement for the previous year:

Myrtle

Sales 560,000

Variable Costs 176,000

Contribution Margin 384,000

Fixed Cost (allocated) 284,375

Profit Margin 99,625

Laurel

Sales 336,000

Variable Costs 174,000

Contribution Margin 162,000

Fixed Cost (allocated) 170,625

Profit Margin (8,625)

Problem 1: What would Clay's profit margin be if the Laurel division was dropped and all fixed costs are unavoidable?

Reference no: EM132715578

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What would clay profit margin be

Reference no: EM132715578

Reference no: EM132715578

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