Ben Blum recently graduated from Moonshadow Universitys accounting program. He has been hired as an analyst by Primrose Tire Company and one of his first assigned tasks was to evaluate the North East division of Primrose. This division has been heavily focused on producing a special snow and mud tire. Sales of the special tire have been disappointing and management is now evaluating whether to eliminate the North East division. Ben performed the following analysis and is preparing to address the Board of Directors of Primrose with his recommendation that the North East division should be eliminated, resulting in an increase to total company profit of $49,000. ?

Ben Blum recently graduated from Mconshadow University's accounting program. He has been hired as an analyst by Primrose Tire Company and one of his first assigned tasks was to evaluate the North East division of Primrose. This division has been heavily focused on producing a special snow and mud tire. Sales of the special tire have been disappointing and management is now evaluating whether to eliminate the North East division. Ben performed the following analysis and is preparing to address the Board of Directors of Primrose with his recommendation that the North East division should be eliminated, resulting in an increase to total company profit of $49,000. All Other Divisions North East Total 33,528,400 Sales Revenue Cost of goods sold Gross profit Operating expenses Net operating income (loss) 63,328.400 $200,000 1957.040 53.000 1,371,30 47,000$1.418,360 3153410 5300113 0 The North East division's cost of goods sold includes $33,000 in fixed costs and operating expenses include $46,000 in foxed costs. None of the fixed costs will be eliminated if the North East division is discontinued. Required: Based on the data given, complete the following table using incremental analysis. (Loss amounts should be indicated by a minus sign.) Not ContinueEliminated Sales Variable COGS Variable Operating Expenses Contnibution Margin Fixed COGS Fixed Operating Expenses Net Operating Income (Loss) 33,000 46,000 S (79,000) 46,000 Based on your calculation should North East division eliminated? Yes ONO