Question
Power Inc. has two divisions, Windsor and Ridge. Following is the income statement for the past month: Windsor Ridge Total Sales $ 360,000 $ 320,000
Power Inc. has two divisions, Windsor and Ridge. Following is the income statement for the past month:
| Windsor | Ridge | Total | |||||||
| Sales | $ | 360,000 | $ | 320,000 | $ | 680,000 | |||
| Variable Costs | 280,000 | 150,000 | $ | 430,000 | |||||
| Contribution Margin | $ | 80,000 | $ | 170,000 | $ | 250,000 | |||
| Fixed Costs (allocated) | 122,000 | 128,000 | $ | 250,000 | |||||
| Profit Margin | $ | (42,000 | ) | $ | 42,000 | $ | 0 | ||
What would the impact on operating income be if Power Inc. discontinued the Windsor Division and could save $24,000 in allocated fixed costs?
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Auditing Processing Learn About Types Of Audits For Auditors Auditing For Dummies
Authors: Mazie Dannenberg
1st Edition
B097DGKYS7, 979-8524930576
