Elizabeth Mars, a recent graduate of Bells accounting program, evaluated the operating performance of Oriole Companys six divisions. Elizabeth made the following presentation to Orioles board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated, she said, our total profits would increase by $27,200.

		The Other Five Divisions		Percy Division			Total
Sales		$1,665,000		$100,100			$1,765,100
Cost of goods sold		977,400		76,900			1,054,300
Gross profit		687,600		23,200			710,800
Operating expenses		528,700		50,400			579,100
Net income		$158,900		$ (27,200	)		$131,700

In the Percy Division, cost of goods sold is $60,000 variable and $16,900 fixed, and operating expenses are $30,800 variable and $19,600 fixed. None of the Percy Divisions fixed costs will be eliminated if the division is discontinued. Is Elizabeth 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).)

Elizabeth Mars, a recent graduate of Bell's accounting program, evaluated the operating performance of Oriole Company's six divisions. Elizabeth made the following presentation to Oriole's board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated," she said, "our total profits would increase by $27,200." The Other Five Divisions Percy Division Total Sales $1,665,000 $100,100 $1,765,100 Cost of goods sold 977,400 76,900 1,054,300 Gross profit 687,600 23,200 710,800 Operating expenses 528,700 50,400 579,100 Net income $158,900 $(27,200) $131,700 In the Percy Division, cost of goods sold is $60,000 variable and $16,900 fixed, and operating expenses are $30,800 variable and $19,600 fixed. None of the Percy Division's fixed costs will be eliminated if the division is discontinued. Is Elizabeth 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 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) $ $ $ Elizabeth is