Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins

Exercise 10

Pepper's Automotive (see Brief Exercise 18-19) has further analyzed the exhaust division into three products: exhaust pipes, intake valves, and intake pipes. The income statement is available below. What is the change in profit in both the short run and long run by dropping intake valves from its product line