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please help on questions 2-3 3. Maxwell Company is considering eliminating Division A because of continued losses. Division A Sales 100 COGS Operating Expenses (100%
please help on questions 2-3
3. Maxwell Company is considering eliminating Division A because of continued losses. Division A Sales 100 COGS Operating Expenses (100% fixed) 50 Net Income (10) Division B 100 30 60 50 Half of Division A's fixed costs are direct and would be eliminated if the division is discontinued. The other half of fixed costs are allocated and would remain even if Division A is closed. Should Division A be eliminated? 4. Butte Candy Company inadvertently produced 10 tons of product without the appropriate chocolate covering. The product could be sold as scrap for $200 per ton. Butte has productive capacity to rework and add chocolate at a cost of $50 per ton and can sell the reworked candy for $260 per ton. Should Butte rework the candy or sell it as is? Show the work that supports your conclusionStep by Step Solution
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