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Perez Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. PEREZ COMPANY Income
Perez Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. PEREZ COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold B Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) $ 165,000 (123,000) (17,000) 25,000 (44,000) (7,000) $ 249,000 $261,000 (84,000) (85,000) (26,000) (23,000) 139,000 153,000 (35,000) (32,000) (14,000) $ (26,000) $ 90,000 $121,000 Net income (loss) Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Revenue and Cost Items for Segment A Effect on income $
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