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Begin by completing the following analysis to determine the increase or decrease in operating income from dropping the Accessories Department, the only Department showing
Begin by completing the following analysis to determine the increase or decrease in operating income from dropping the Accessories Department, the only Department showing an operating loss this quarter. (Enter decreases to profits with a parentheses or minus sign.) Deela Fashions Analysis of Dropping the Accessories Department Expected decrease in revenues Expected decrease in costs: Expected decrease in variable costs Expected decrease in fixed costs Expected decrease in total costs in operating income Net Sales Revenue Variable Costs Contribution Margin Fixed Costs Operating Income (Loss) For the Quarter Ended September 30, 2018 Department Women's $ Deela Fashions Income Statement $ Men's 107,000 $ 62,000 45,000 25,000 20,000 $ 58,000 $ 26,000 32,000 21,000 11,000 $ Accessories 98,000 $ 90,000 8,000 23,000 (15,000) $ Total 263,000 178,000 85,000 69,000 16,000
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