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3:40:28 A manufacturer is considering eliminating a segment because it shows the following $6,000 loss. All $20,000 of its variable costs are avoidable; and
3:40:28 A manufacturer is considering eliminating a segment because it shows the following $6,000 loss. All $20,000 of its variable costs are avoidable; and $36,000 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 60,000 20,000 40,000 46,000 (6,000) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be eliminated? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute the income increase or decrease from eliminating this segment. Income Increase i (Decrease) Segment Elimination Analysis Continue Eliminate Sales $ 60,000 Variable costs: 20,000 Contribution margin 40,000 Fixed costs Income (loss) 46,000 10,000 $ (6,000) S (6,000) 4,000
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