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Problem: Module 6 Textbook Problem 7 Learning Objective: 6-4 Make appropriate segment elimination decisions Stuart Company operates three segments. Income statements for the segments imply

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Problem: Module 6 Textbook Problem 7 Learning Objective: 6-4 Make appropriate segment elimination decisions Stuart Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated 30 STUART COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net Income Class) $ 169,000 (125,000) (22.000) 22,000 (39.000) (5.000) $ (22,000) $ 238,000 (77,000) (24,000) 137,000 (41,000) (17.000 $ 79,000 $250,000 (90,000) (23,000) 137,000 (35,000) 0 $102,000 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: () the retention of Segment A and (2) the elimination of Segment A Complete this question by entering your answers in the tabs below. Assement Tool Frame Required A Required Prepare a schedule of relevant sales and costs for Segment A Relevant Rev. and Cost items for Segment A Advertising expense (specific to individual divisions) Net income (los) (5,000) $ (22,000) 17,000) $ 79,000 $102,000 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 Aa the elimination of Segment A. 07 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Effect on income Red A Required B > LIIC CHROUGH VI JOYL Complete this question by entering your answers in the tabs below. Required A Required B 56 Prepare comparative Income statements for the company as a whole under two alternatives: (1) the retention of Segme and (2) the elimination of Segment A. STUART COMPANY Comparative Income Statements for the Year 2 Decision Keep Seg. A Eliminate Seg. A Sales Cost of goods sold Sales commissions Contribution margin General foxed operating expenses Advertising expenso Not Income

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