Losses have been incurred at Millard Corporation for some time. In an effort to isolate the problem and improve the companys performance, management has requested that the monthly income statement be segmented by sales region. The companys first effort at preparing a segmented statement is given below. This statement is for May, the most recent month of activity.

	Sales Region
	West		Central		East
Sales	$	311,000	$	798,000	$	696,000
Regional expenses (traceable):
Cost of goods sold		96,000		236,000		318,000
Advertising		110,000		244,000		241,000
Salaries		52,000		55,000		109,000
Utilities		8,700		15,900		14,000
Depreciation		20,000		30,000		26,000
Shipping expense		29,000		32,000		41,000
Total regional expenses		315,700		612,900		749,000
Regional income (loss) before corporate expenses		( 4,700)		185,100		(53,000)
Corporate expenses:
Advertising (general)		16,000		38,000		35,000
General administrative expense		22,000		22,000		22,000
Total corporate expenses		38,000		60,000		57,000
Net operating income (loss)	$	(42,700)	$	125,100	$	(110,000)

Cost of goods sold and shipping expense are both variable; other costs are all fixed. Millard Corporation is a wholesale distributor of office products. It purchases office products from manufacturers and distributes them in the three regions given above. The three regions are about the same size, and each has its own manager and sales staff. The products that the company distributes vary widely in profitability.

Required:

1.	For each segment, identify the effect on the company's net operating income from dropping the segment. Enter each segment's effect in its respective space below. Do not combine effects. Enter each segment's effect separately.

2.	Calculate each segment's contribution margin ratio and enter it in its respective space below. Do not combine ratios. Enter each segment's ratio separately. Round the percentage, not the decimal value, to one decimal (i.e. .1258 would be entered as 12.6).

3.

The company has $5,500 of unused advertising funds available to spend on one of the segments. The additional revenue would be earned in the region in which the advertising takes place. Marketing projects that the additional revenue ($10,450) that would be generated from this additional advertising would be the same, regardless of where (which region) the advertising occurs. In which region should the advertising occur to provide the greatest increase in company income?

4.	If the company spends the $5,500 of advertising funds (from part 3, above) in the West region, and realizes the additional revenue of $10,450, what would be the increase/(decrease) in company income? Enter a decrease as a negative number. Round to the nearest whole dollar.
	operating income = West?