Dropping a segment George's Grill analyzes profitability of three operating

units: restaurant, bar, and billiards room. Revenues, variable costs, and

attributable fixed costs (which can be avoided if the unit is eliminated) for

each unit are as follows:

RESTAURANT BAR BILLIARDS ROOM

Revenue $320,000 $150,000 $40,000

Variable costs 120,000 35,000 10,000

Attributable fixed costs 80,000 25,000 15,000

George, the owner, is considering converting the billiards area into an

expanded bar area.

Required

(a) Ignoring remodeling costs, by how much will the bar segment margin have to increase for the

grill's income to be at least as high as it is now?

(b) What other considerations will George want to consider before making the decision to

eliminate the billiards unit to expand the bar area?