Company X is in the process of deciding whether to maintain or discontinue brand A. The following information refers to Brand A: Contribution margin = $65942
Avoidable fixed costs = $59347,8
Non-avoidable fixed costs = $52753,6
Company X should ___________

Question

Company X is in the process of deciding whether to maintain or discontinue brand A. The following information refers to Brand A:  Contribution margin = $65942 
 Avoidable fixed costs = $59347,8 
 Non-avoidable fixed costs = $52753,6 
  Company X should ___________

Accepted Answer

Keep brand A because the $65942 contribution margin is larger than avoidable costs

Answer

Keep brand A because the $65942 contribution margin is smaller than total costs.

Answer

Discontinue brand A because avoidable costs are larger than non-avoidable costs

Answer

None of the others

Answer

Keep brand A because the $65942 contribution margin is larger than non-avoidable costs.

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Company X is in the process of deciding whether to maintain or discontinue bran...

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