4.The following partial income statements are for the Southeast and Northwest Divisions of US Games. These two divisions operate in the same industry but in different geographical markets.

SoutheastNorthwest

Sales $3,000,000$3,000,000

Variable CGS (2,400,000)(1,000,000)

Variable selling costs (250,000)(250,000)

Avoidable direct fixed costs(400,000)(900,000)

Unavoidable direct fixed costs (100,000)(1,000,000)

Allocated fixed costs (300,000)(300,000)

Operating income $ (450,000)$ (450,000)

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Required:

a.

Are these two divisions equally unprofitable? Why or why not? (3 marks)