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Finlay Grace Sullivan and Company has two sales office: one located in Portland, Maine and one in Portsmouth, New Hampshire. Managment is considering dropping the
Finlay Grace Sullivan and Company has two sales office: one located in Portland, Maine and one in Portsmouth, New Hampshire. Managment is considering dropping the Portland offcie. the company's record report the following information:
Portland | Portsmouth | |
Sales | $40000 | $50000 |
Direct Costs | ||
Variable | $15000 | 25000 |
Fixed | 10000 | 10000 |
What will be the effect on income if the Portland office is eliminated and half of it fixed costs are avoided?
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