Brislin Company has four operating divisions. During the first quarter of 2020, the company reported aggregate income from operations of $214,200 and the following divisional results. Division 11 IV $254,000 $199,000 $501,000 $443,000 204,000 189.000 301,000 247,000 Sales Cost of goods sold Selling and administrative expenses Income (loss) from operations 69.800 60,000 57,000 55,000 $(19,800) $(50,000) $143,000 $141,000 Analysis reveals the following percentages of variable costs in each division II III IV 67 % 90 % 82 % 75 % Cost of goods sold Selling and administrative expenses 39 62 50 58 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued. Compute the contribution margin for Divisions I and II. (Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. (45).) Division 1 Division II Contribution margin $ 90098 $ -8300 e Textbook and Media Prepare an incremental analysis concerning the possible discontinuance of Division 1. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Continue Eliminate Net Income Increase (Decrease) Contribution margin $ $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $ $ $ eTextbook and Media Prepare an incremental analysis concerning the possible discontinuance of Division II. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Continue Eliminate Net Income Increase (Decrease) Contribution margin $ $ $ Fixed costs Cost of goods sold Selling and administrative Total fixed expenses Income (loss) from operations $ $ $ e Textbook and Media Question Part Score --/0.4 What course of action do you recommend for each division? Division 1 Division II e Textbook and Media Prepare a columnar condensed income statement for Brislin Company, assuming Division Il is eliminated. Division II's unavoidable fixed costs are allocated equally to the continuing divisions. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45).) BRISLIN COMPANY CVP Income Statement For the Quarter Ended March 31, 2020 Divisions III IV Sales $ $ $ Variable costs Cost of goods sold Selling and administrative Total variable costs Contribution margin Fixed costs Cost of goods sold Selling and administrative Total fixed costs Income (loss) from operations $ $ $ $
