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A retalling company has two departments - Department A and Department B. The company's most recent contribution format income statement follows: Sales Variable expenses Contribution

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A retalling company has two departments - Department A and Department B. The company's most recent contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) Total $800,000 320,000 480,000 400,000 $ 80,000 Department Departments $350,000 $450,000 120,000 200,000 230,000 250,000 140,000 260,000 $ 90,000 $(10,000) The company says that $110,000 of the fixed expenses being charged to Department Bare sunk costs or allocated costs that will continue If the segment is discontinued. However, if Department B is discontinued the sales in Department A will drop by 6%. How much does the company's profit increase or decrease if Department B is discontinued? (If a decrease, the dollar amount is Indicated in parentheses,l.e., $ (1,000).) Multiple Choice $ 1133,800)

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