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Rock Inc has three divisions, Granite, Lime and Nina. All fixed costs are unavoidable Following is the income statement for the previous year Sales Variable

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Rock Inc has three divisions, Granite, Lime and Nina. All fixed costs are unavoidable Following is the income statement for the previous year Sales Variable Costa Contribution Margin Fixed Coats (allocated) Protit Hargin Granite $504,000 179,000 325,000 257,000 $ 68,000 Lime Nina $ 272,000 $227,000 124.200 100, 800 147,800 126,200 170,250 108,750 S (22,450) $ 17,450 Total $1,000,000 404,000 599,000 536,000 $ 63,000 a. What would Rock's profit margin be if the Lime division were dropped? Profit Loss b. What would Rock's profit margin be if the Nina division were dropped? Profit Loss

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