Required information Exercise 23-10 Analysis of income effects from eliminating departments LO A1 (The following information applies to the questions displayed below.] Suresh Co. expects its five departments to yield the following income for next year. Dept. M $68,000 Dept. N $ 38,000 Dept. 0 $65,000 Dept. P $47,000 Dept. T $ 33,000 T otal $251,000 Sales Expenses Avoidable Unavoidable Total expenses Net income (loss) 12,300 53,800 66,100 $ 1,900 39,400 15,600 55,000 $(17,000) 23,900 4,700 28, 600 $36, 400 16,500 36, 400 52,900 $(5,900) 42,300 13,300 55,600 $(22,600) $134, 400 $123, 800 258, 200 $ (7,200) Recompute and prepare the departmental income statements (including a combined total column) for the company under each of the following separate scenarios. Exercise 23-10 Part 1 (1) Management eliminates departments with expected net losses. DEPARTMENTS WITH EXPECTED NET LOSSES ELIMINATED Dept. M Dept. N Dept. o D ept. P Dept. I Total Sales Expenses: Avoidable Unavoidable Total expenses Net income (loss) 0 $ 0 $ 0 $ 0 $ 0 Required information Exercise 23-10 Analysis of income effects from eliminating departments LO A1 [The following information applies to the questions displayed below.) Suresh Co. expects its five departments to yield the following income for next year. Dept. M $68,000 Dept. N $ 38,000 Dept. 0 $65,000 Dept. P $47,000 Dept. T $ 33,000 Total $251, 000 Sales Expenses Avoidable Unavoidable Total expenses Net income (loss) 12,300 53,800 66, 160 $ 1,900 39,400 15.600 55,000 $(17, 000) 23,900 4,700 28, 600 $36, 400 16,500 36.400 52, 900 $(5,900) 42, 300 13, 300 55,600 $(22,600) $134,400 $123,800 258, 200 $ (7,200) Recompute and prepare the departmental income statements (including a combined total column) for the company under each of the following separate scenarios. Exercise 23-10 Part 2 (2) Management eliminates departments with sales dollars that are less than avoidable expenses. DEPARTMENTS WITH LESS SALES THAN AVOIDABLE EXPENSES ELIMINATED Dept. M Dept. N Dept. o D ept.P Dept. T Total Sales Expenses: Avoidable Unavoidable Total expenses Net income (loss) $ 0 $ 0 $ 0 $ 0 $ 0 $