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A company has two departments, Kids and Adults. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution Margin Fixed Expenses

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A company has two departments, Kids and Adults. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution Margin Fixed Expenses Net operating income foss) Department Total Kids Aduits $4,200,000 $3,000,000 $1,200,000 2.000.000 1.500,000 500.000 2,200,000 1,500,000 700.000 2200.000 1.300.000 900.000 0 200,000 (200,000) A study indicates that $250,000 of the fired expenses being charged to the Adults Department are sunk costs or alocated costs that will continue even if the Adults Department is dropped. In addition, the elimination of the Adults Department will result in a 10% decrease in the sales of the Kids Department of the Adults Department is dropped, what will be the effect on the net operating income of the company as a whole? Multiple Choice Decrease by $210,000 Increase by $210,000

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