Thomas Corporation has four departments, all of which appear to be profitable except department 4. Operating data for 2019 are as follows:

Required

a. Calculate the gross profit percentage for departments 1-3 combined and for department 4.

b. What effect would elimination of department 4 have had on total firm net income? (Ignore the effect of income tax.)

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Total Departments 1-3 Department 4 Sales. $950,000 Cost of sales. Gross profit.. Direct expenses Common expenses. Total expenses. 626,000 $800,000 512,000 $150,000 114,000 $324,000 $288,000 $ 36,000 $144,000 125,000 $120,000 105,000 $269,000 $225,000 Net income (Loss) $ 55,000 $ 63,000 $ 24,000 20,000 $ 44,000 $ (8,000)