Question 5 (7 marks) Yvan Kabenga, President of Kabenga Limited is considering starting a new division to Kabenga's Canadian operations. He is reviewing the projected financial statements for the proposed Cape Breton Division. The financial statement and additional information is presented below: Cape Breton Division Projected Income Statement Year Ending June 30, 2022 Sales Variable expense Contribution margin Depreciation expense (1) Property tax expense (1) Administrative expenses (2) Salary expense (3) Advertising expense (4) Overhead expense (5) Utilities expense (3) Net loss $800,000 450,000 350,000 40,000 30,000 80,000 150,000 60,000 45 000 38.000 $(93.000) (1) (2) Relates to a new building and equipment required to start the new Division 30% relates directly to administration at the Cape Breton Division with the (1) (2) Relates to a new building and equipment required to start the new Division. 30% relates directly to administration at the Cape Breton Division with the 70% remainder being allocated from Head Office. Relates 100% to the Cape Breton Division. 40% is advertising for the Cape Breton Division and the remaining portion is allocated from Head Office. (3) (4) (5) 100% allocated from Head Office. Required: Should the Cape Breton Division be opened