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NEED ANSWERS FAST PROPERLY PLS! -/3 View Policies Current Attempt in Progress Nicole Filippas, a recent graduate of Rollings University's accounting program, evaluated the operating
NEED ANSWERS FAST PROPERLY PLS!
-/3 View Policies Current Attempt in Progress Nicole Filippas, a recent graduate of Rollings University's accounting program, evaluated the operating performance of Poway Company's six divisions. Nicole made the following presentation to Poway'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 Erie Division Total Sales The Other Five Divisions $1.663.000 977,000 $100,000 $1.763,000 76,000 1.053,000 686,000 24,000 710,000 Cost of goods sold Gross profit Operating expenses Net income 526,000 47.500 573,500 $160,000 ${23.500 $136,500 In the Erie division, the cost of goods sold is $59,000 variable and $17,000 fixed, and operating expenses are $14.000 variable and $33,500 fixed. None of the Erie division's fixed costs will be eliminated if the division is discontinued. VESTMnued Is Nicole 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 numberes -15,000 or parenthesis es (15,0001.) Net Income Increase (Decrease Continue Eliminate Sales S $ Variable costs Contribution margin V Fixed costs v S Net income loss) $ $ Nicole is incorrect Step by Step Solution
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