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Managerial Accounting

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Privos Partners: Change to Profits if V78 is Eliminated

MGRACT-FSWJEL

Privos Partners wants to eliminate the V78 Product Line. The sales and costs for the V78 product line are shown below.

V78 Product Line
Sales \$1,200,000
Variable costs \$990,000
Fixed costs \$270,000
Loss (\$60,000)

What will be the change to Privos Partners if V78 is eliminated, assuming that all of the fixed costs are unavoidable?