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Michelle Walker, a recent graduate of Clinton University's accounting program, evaluated the operating performance of Sweet Acacia Company's six divisions. Michelle made the following presentation
Michelle Walker, a recent graduate of Clinton University's accounting program, evaluated the operating performance of Sweet Acacia Company's six divisions. Michelle made the following presentation to Sweet Acacia's board of directors and suggested the Erie division be eliminated. "If the Erie division is eliminated," she said, "our total profits would increase by $23.500." In the Erie division, the cost of goods sold is $59,700 variable and $16,400 fixed, and operating expenses are $15,300 variable and $32.200 fixed. None of the Erie division's fixed costs will be eliminated if the division is discontinued. Is Michelle right about eliminating the Erie Division? Prepare a schedule to support your answer. (If an amount reduces the net income then enter with a negative sign preceding the number e.s. 15,000 or parenthesis, e.g. (15,000). Michelle is
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