Kogan Company has two divisions whose most recent financial statements are shown below:

A) Compute the impact on profit if the Residential Division is eliminated.

B) Do you recommend that Kogan eliminate the Residential Division?

Commercial Residential Division Division 10,000 2,000 $800,000 $200,000 Unit sales Sales Less: cost of goods sold: Unit-level production costs Depreciation, prodotion equipment Gross margin Less: operating expenses: Unit-level selling and administrative Corporate-level facility costs (fixed) Net income (loss) 350,000 150,000 $300,000 120,000 50,000 $ 30,000 80,000 25,000 $195.000 20,000 15.000 ($ 5,000