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A manufacturer is considering eliminating a segment because it shows the following $6,100 loss. All $20,200 of its variable costs are avoidable, and $36,500 of
A manufacturer is considering eliminating a segment because it shows the following $6,100 loss. All $20,200 of its variable costs are avoidable, and $36,500 of its fixed costs are avoidable. Sentment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 60,600 20, 200 40,400 45,500 (6,180) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be eliminated? 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. Segment Elimination Analysis Continue Eliminate Income Increase (Decrease) S Sales Variable costs Contribution margin Fixed costs Income (loss) 60 600 20,200 40.400 48.500 (6.100) S
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