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Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and
Marin Company makes several products, including canoes. The company reports a loss from its canoe segment (see below). All its variable costs are avoidable, and $337,500 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 1,127,000 805,000 322,000 385,000 $ (63,000) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be continued or eliminated? Complete this question by entering your answers in the tabs below. Required A Required B Compute the income increase or decrease from eliminating this segment. Segment Elimination Analysis Continue Eliminate 0 0 Income Increase (Decrease) Income (loss) $ 0 $ 0 $ 0 Required information [The following information applies to the questions displayed below.) Suresh Company reports the following segment (department) income results for the year. Sales Department M $ 73,000 Department N $ 39,000 Department O $ 66,000 Department P $ 48,000 Department T $ 34,000 Expenses Avoidable. 12,800 Unavoidable Total expenses Income (loss) 54,200 67,000 40,000 16,200 56,200 24,200 17,000 43,200 4,800 29,000 37,000 54,000 14,000 57,200 $ 6,000 $ (17,200) $ 37,000 $ (6,000) $ (23,200) b. Compute the total increase in income if the departments with sales less than avoidable costs, as identified in part a, are eliminated. Total increase in income
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