Asked by Bridger Johnson on Jun 09, 2024
Verified
The eliminating of an unprofitable product line may actually decrease total company net income.
Incremental Variable Costs
Costs that change with the level of output, affecting each additional unit produced.
Incremental Revenues
The additional income generated from a specific action or decision.
Total Company Net Income
The aggregate net income of a company across all its business operations and segments.
- Understand the impacts of eliminating an unprofitable product line on total net income.
Verified Answer
IE
Islam ElshreifJun 10, 2024
Final Answer :
True
Explanation :
Eliminating an unprofitable product line may result in a decrease in overall revenue and may also harm the company's reputation and market share in the industry. These factors can ultimately lead to a decrease in total company net income.
Learning Objectives
- Understand the impacts of eliminating an unprofitable product line on total net income.
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