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alabama corporation has two departments,Toys and Candy. The cimoanys most recent monthly contribution format income statement follows: An alabama study indicates that $150,000 of the
alabama corporation has two departments,Toys and Candy. The cimoanys most recent monthly contribution format income statement follows:
An alabama study indicates that $150,000 of the fixed expenses being charged to the candy department are sunk costs or allocated costs that will continue even if the candy department is dropped. In addition the elimination of the candy department will result in a 20% decrease in the sales of the Toys department.
Q: If the candy department is dropped, what will be the effectnon the net operating income of Alabamas corporation as a whole?
A. Decrease by 250000
B. Decrease by 230000
C.Increase by 270000
D. Decrease by: 270000
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