Question
Kentucky Distributors has two divisions Northern and Southern. The divisions have provided the following financial information: Northern Southern Sales $162,820 $203,670 Variable costs 93,730 108,590
Kentucky Distributors has two divisions Northern and Southern. The divisions have provided the following financial information:
Northern Southern
Sales $162,820 $203,670
Variable costs 93,730 108,590
Common fixed costs 78,860 70,690
Operating income ($9,770) $24,390
Kentuckys executives are considering the elimination of the Northern division. If the division is eliminated, the common fixed costs will remain unchanged. Given these data, should the Northern division be eliminated? (Enter loss using either a negative sign preceding the number e.g. -4,527 or parentheses e.g. (4,527).)
Total With Northern Without Northern
Operating income $ $
Kentucky___________ eliminate the Northern division.
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