The ABC department store has three major product lines: hardware, clothing, and sporting goods.  The store is considering dropping the clothing line because the income statement shows that it is operating at a loss. Note the income statement for these product lines below:

Â	Hardware	Clothing	Sporting Goods	Total
Sales	$10,000	$15,000	$25,000	$50,000
Less: Variable costs	$6,000	$8,000	$12,000	$26,000
Contribution Margin	$4,000	$7,000	$13,000	$24,000
Less: Fixed costs	Â	Â	Â	Â
Direct	$2,000	$6,500	$4,000	12,500
Allocated	$1,000	$1,500	$2,500	$5,000
Total fixed costs	$3,000	$8,000	$6,500	$17,500
Net Income	$1,000	($1,000)	$6,500	$6,500

Should the store drop the clothing line of business?  Explain using the sales and cost data above.

You have been provided with two areas in the course to discuss and collaborate:  A group discussion forum and this wiki collaboration area.  Only group members have access to these areas and will be able to see the discussion you have and the work you do within these areas.  You are also free to use tools outside of the course, such as Google Docs, Yammer, etc.  if your group chooses to do so.  

Your final PowerPoint presentation should consist of 3-4 slides (10 maximum) and is due in Unit 7.  You will have the next 2 units to work together to create the PowerPoint. Once you’re finished, everyone in your group must post a copy of the final presentation in the Group Activity Submission area in Unit 7.  

Your PowerPoint content should look professional.  Check all content for grammar, spelling and to be sure that you have properly cited all resources (in APA format) used in the creation of the presentation.