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Finch Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. FINCH COMPANY Income Statements

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Finch Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. FINCH COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (loss) A B $ 165,000 $244,000 (121,000) (81,000) (19,000) (26,000) 25,000 137,000 (34,000) (49,000) (5,000) (17,000) $ (14,000) $ 86,000 $265,000 (88,000) (32,000) 145,000 (39,000) 0 $ 111,000 Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Complete this question by entering your answers in the tabs below. Required A Required B

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