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Physical Phitness, Inc. operates three divisions, Weak, Average, and Strong. As it turns out, the Weak division has the lowest operating income, and the president

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Physical Phitness, Inc. operates three divisions, Weak, Average, and Strong. As it turns out, the Weak division has the lowest operating income, and the president wants to close it. "Survival of the fittest, I say!" was his response when the Weak division's manager insisted Anna Hoffman that his division earned money for the company. Following is the most recent financial analysis for each division: Weak Average Strong $450,000 $600,000 250,000 300,000 Sales revenue Variable expenses Contribution margin Direct expenses Allocated expenses Operating income $125,000 45,000 80,000 30,000 70,000 200,000 300,000 100,000 80,000 70,000 70,000 $(20,000) $50,000 $130,000 Your answer is partially correct. Based on the way allocated expenses are divided among the divisions, what do you think will happen to the Average division if the company continues to prepare financial statements in this way, assuming Weak was dropped? xpenses of $ 105000 resulting in an operating income of $ for the division

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