Management of Bluebird Manufacturing is considering whether to drop a product line
So far, management has determined that the product has a negative contribution margin and that lost revenues are less than the total cost savings. In making the final decision, what are other questions that the management of Bluebird should consider?
What will be an ideal response
Would dropping the product affect other product sales?
Would Bluebird lose customers who want this product as part of one-stop shopping?
What will Bluebird do with the freed manufacturing capacity?
What total costs-variable and fixed-will change?
Are there additional environmental costs that should be considered?
Should Bluebird consider outsourcing the production of this product?
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