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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 21 Sales commissions Segment Sales Cost of goods sold Contribution margin: B C $ 168,000 $254,000 $257,000 (123,000) (73,000) (78,000) (22,000) (28,000) (24,000) 23,000 153,000 155,000 General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) (37,000) (46,000) (33,000) (4,000) (17,000) 0 Net income (loss) $ (18,000) $ 90,000 $122,000 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 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. PEREZ COMPANY Comparative Income Statements for the Year 2
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