23 3 points Alfa Corporation has four departments, all of which appear to be profitable except...
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23 3 points Alfa Corporation has four departments, all of which appear to be profitable except department 4. Operating data for 2022 are as follows: Departments 1-3 Department 4 Sales Total $2,100,000 $1,650,000 $450,000 Cost of sales (variable) 1,326,000 1,006,500 319,500 Gross profit (contribution margin) 774,000 643,500 130,500 Direct fixed expenses $144,000 $120,000 $24,000 Common fixed expenses 316,000 200,500 115,500 Total expenses 460,000 320,500 139,500 Net income (Loss) $314,000 $323,000 $9,000) Which of the following is correct if the department 4 is eliminated? (Ignore the effect of income tax.) The firm's net income will decrease by 130,500. The firm's net income will decrease by $106,500 The firm can save common fixed expenses allocated to Department 4. The direct fixed expenses for Department 4 is unavoidable. 3 points 23 3 points Alfa Corporation has four departments, all of which appear to be profitable except department 4. Operating data for 2022 are as follows: Departments 1-3 Department 4 Sales Total $2,100,000 $1,650,000 $450,000 Cost of sales (variable) 1,326,000 1,006,500 319,500 Gross profit (contribution margin) 774,000 643,500 130,500 Direct fixed expenses $144,000 $120,000 $24,000 Common fixed expenses 316,000 200,500 115,500 Total expenses 460,000 320,500 139,500 Net income (Loss) $314,000 $323,000 $9,000) Which of the following is correct if the department 4 is eliminated? (Ignore the effect of income tax.) The firm's net income will decrease by 130,500. The firm's net income will decrease by $106,500 The firm can save common fixed expenses allocated to Department 4. The direct fixed expenses for Department 4 is unavoidable. 3 points
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