Question 17 Not yet answered Marked out of 10,00 Flag question Dropping Unprofitable Department Penn Corporation has four departments, all of which appear to be profitable except department 4. Operating data for 2019 are as follows: Departments 1-3 Department 4 Sales Total $1,650,000 $1,400,000 $250,000 Cost of sales 945,000 770,000 175,000 Gross profit 705,000 630,000 75,000 Direct expenses $177,000 $150,000 $27,000 Common expenses 212,000 156,000 56.000 Total expenses 389,000 306,000 83.000 Net income (Loss) $315,000 $124,000 000) a. Calculate the gross profit percentage for departments 1-3 combined and for department 4. Department 1-3 Department 4 46 b. What effect would elimination of department 4 have had on total firm net income? (Ignore the effect of income tax) The firm's net income would be: $