Prockets inc. just eliminated a product that had yearly sales of $120,000, yearly variable expenses of $48,000, and yearly fixed expenses of $92,000. by dropping the product, sprockets increased its company-wide yearly net income by $10,800. these data indicate that when sprockets discontinued the product, it was also able to eliminate of the fixed costs associated with that product.

Savings in fixed costs= 30,800

Explanation:

Giving the following information:

Prockets Inc. just eliminated a product that had yearly sales of $120,000, yearly variable expenses of $48,000, and yearly fixed expenses of $92,000. By dropping the product, Sprockets increased its company-wide yearly net income by $10,800.

Loss= 120,000 - 48,000 - 92,000= -20,000

By dropping the product:

Savings in fixed costs= 20,000 + 10,800= 30,800

answer; be sure that the information on file is correct;

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