Coronado Mars, a recent graduate of Bells accounting program, evaluated the operating performance of Dunn Companys six divisions. Coronado made the following presentation to Dunns board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated, she said, our total profits would increase by $25,300.

		The Other Five Divisions		Percy Division			Total
Sales		$1,663,000		$100,900			$1,763,900
Cost of goods sold		978,400		76,500			1,054,900
Gross profit		684,600		24,400			709,000
Operating expenses		528,500		49,700			578,200
Net income		$156,100		$ (25,300	)		$130,800

In the Percy Division, cost of goods sold is $60,100 variable and $16,400 fixed, and operating expenses are $29,100 variable and $20,600 fixed. None of the Percy Divisions fixed costs will be eliminated if the division is discontinued. Is Coronado right about eliminating the Percy Division? Prepare a schedule to support your answer. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Net Income Increase (Decrease) Continue Eliminate Sales $ $ $ Variable costs Cost of goods sold Operating expenses Total variable Contribution margin Fixed costs Cost of goods sold Operating expenses Total fixed Net income (loss) $ $ $ $ Coronado is