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Party Supply is trying to decide whether or not to continue its costume segment. The information shown is available for Party Supply's business segments. Assume
Party Supply is trying to decide whether or not to continue its costume segment. The information shown is available for Party Supply's business segments. Assume that neither the Direct fixed costs nor the Allocated common fixed costs may be eliminated, but will be allocated to the two remaining segments. Floral Decorations Costumes Sales $160,000 $211,000 85,000 120,000 Variable costs Contribution margin Direct fixed costs Party Supplies $111,000 50,000 $61,000 20,000 25,000 $16,000 $75,000 $91,000 25,000 29,000 50,000 31,000 $(6,000) Allocated common fixed costs Net Income $37,000 If costumes are dropped, what change will occur to profit? Profit will
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