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    Managerial Accounting: Dropping a Product

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    Pacific Pump Company, a small manufacturing firm in Vancouver BC manufactures 3 types of pumps used in a variety of applications. For many years the company has been profitable and has operated at capacity. However in the last 2 years prices on all pumps were reduced and selling expenses increased to meet competition and keep the plant operating at capacity. Second quarter results for the current year, which follow typify recent experience.

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    Solution Summary

    This solution discusses dropping a product.