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Lan Shu Bruce Company has three product lines, one of which reflects the following results: If this product line is eliminated, 60% of the fixed
Lan Shu Bruce Company has three product lines, one of which reflects the following results: If this product line is eliminated, 60% of the fixed expenses (F/C) can be eliminated and the other 40% will be allocated to other product lines. If management decides to eliminate this product line, the company's Overall Net Income (NI) will increase by $50,000. decrease by $90,000. decrease by $6,000. increase by $6,000. Old and Feeble Minded Professor Mullen Corporation has the following data: Sales $350,000 Variable expenses 150,000 Fixed expenses 275,000 What will be the effect on Overall Net Income (NI) if this segment is eliminated, assuming the fixed expenses will be allocated to profitable segments, that is $ 0 Fixed Costs (F/C) go away? $200,000 increase $200,000 decrease $275,000 decrease Cannot be determined from the data provided. Lao Shu Bruce Corp has the following information: Sales $900,000 Variable expenses 480,000 Fixed expenses 465,000 If this division is eliminated, the fixed expenses will be allocated to the company's other divisions, or $0 Fixed Expenses (F/C) go away. What is the incremental effect on Overall Net Income (NI) if the division is dropped? $45,000 increase $465,000 decrease $420,000 decrease $435,000 increase
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