Problem 11-19 (Algo) Dropping or Retaining a Segment [LO11-2) Jackson County Senior Services is a nonprofit organization devoted to providing essential services to seniors who live in their own homes within the Jackson County area. Three services are provided for seniors-home nursing, Meals On Wheels, and housekeeping. Data on revenue and expenses for the past year follow: House- keeping $ 255,000 Revenues Variable expenses Contribution margin: Fixed expenses: Depreciation Liability insurance Program administrators' salaries General administrative overhead Total fixed expenses Net operating income (loss) "Allocated on the basis of program revenues. Total $925,000 468,000 Home Nursing $ 266,000 Meals On Wheels $ 404,000 112,000 457,000 154,000 197,000 207,000 159,000 96,000 69,900 8,900 40,900 20,100 44,000 20,400 7,800 15,800 114,400 40,400 38,900 35,100 185,000 53,200 80,800 51,000 413,300 122,900 168,400 122,000 $ 43,700 $ 31,100 $ 38,600 $ (26,000) The head administrator of Jackson County Senior Services, Judith Miyama, considers last year's net operating income of $43,700 to be unsatisfactory; therefore, she is considering the possibility of discontinuing the housekeeping program. The depreciation in housekeeping is for a small van that is used to carry the housekeepers and their equipment from job to job. If the program were discontinued, the van would be donated to a charitable organization. None of the general administrative overhead would be avoided if the housekeeping program were dropped, but the liability insurance and the salary of the program administrator would be avoided..