《Survey of accounting 2th会计学 Carl S.Warren》ch12.pptVIP

1. Leasing or selling equipment 2. Discontinuing an unprofitable segment 3. Manufacturing or purchasing a needed part 4. Replacing usable fixed assets 5. Processing further or selling an intermediate product 6. Accepting additional business at a special price Differential revenue from alternatives: Revenue from lease $160,000 Revenue from sales 100,000 Differential revenue from lease $60,000 Differential cost of alternatives: Repairs, insurance, taxes $ 35,000 Commission expense on sale 6,000 Differential cost of lease 29,000 Net differential income from leasing $31,000 Revenue from lease $160,000 Revenue from sales 100,000 Repairs, insurance, taxes (35,000) Commission expense on sale (6,000) Totals $125,000 $94,000 Revenue from lease $160,000 Revenue from sales 100,000 Repairs, insurance, taxes (35,000) Commission expense on sale (6,000) Totals $125,000 $94,000 Net benefit from leasing $31,000 Sales $100,000 $500,000 $400,000 $1,000,000 Cost of goods sold: Variable costs $ 60,000 $220,000 $200,000 $ 480,000 Fixed costs 20,000 120,000 80,000 220,000 Total cost of goods sold $ 80,000 $340,000 $280,000 $ 700,000 Gross profit $ 20,000 $160,000 $120,000 $ 300,000 Operating expenses: Variable expenses $ 25,000 $ 95,000 $ 60,000 $ 180,000 Fixed expenses 6,000 25,000 20,000 51,000 Total operating expenses $ 31,000 $120,000 $ 80,000 $ 231,000 Income (loss) from operations $ (11,000) $ 40,000 $ 40,000 $ 69,000 Sales $100,000 $500,000 $400,000 $1,000,000 Cost of goods sold: Variable costs $ 60,000 $220,000 $200,000 $ 480,000 Fixed costs 20,000 120,000 80,000 220,000 Total cost of goods sold $ 80,000 $340,000 $280,000 $ 700,000 Gross profit $ 20,000 $160,000 $120,000 $ 300,000 Operating expenses: Variable expenses $ 25,000 $ 95,000 $ 60,000 $ 180,000 Fixed expenses 6,000 25,000 20,000 51,000 Total operating expenses $ 31,000 $120,000 $ 80,000 $ 231,000 Income (loss) from