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A guitar manufacturer is considering eliminating its electric guitar division because its $81,430 expenses are higher than its $76,480 sales. The company reports the

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A guitar manufacturer is considering eliminating its electric guitar division because its $81,430 expenses are higher than its $76,480 sales. The company reports the following expenses for this division. Cost of goods sold Direct expenses Indirect expenses Service department costs. Avoidable Expenses Unavoidable Expenses $ 57,500 11,850 500 6,400 $1,450 2,250 1,480 Should the division be eliminated? (Any loss amount should be indicated with minus sign.) Cost of goods sold Direct expenses Indirect expenses Service department costs Total avoidable expenses Revenues from electric guitar division Revenues are greater than (less than) avoidable expenses by Should the electric guitar division be: Avoidable expenses 4

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