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Scenario A merchandising company has two departments, A and B. A recent monthly income statement for the company follows: A study indicates that $340,000 of
Scenario A merchandising company has two departments, A and B. A recent monthly income statement for the company follows: A study indicates that $340,000 of fixed expenses being charged to department B are allocated costs that will continue even if B is dropped. In addition, the elimination of department B will result in a 10 percent decrease in the sales of department A. Question If department B is dropped, what will be the effect on the income of the company as a whole? Note: The correct answer should be typed into the space provided. You must also show your work that illustrates how you arrived at your answer by using the Insert menu option. Then, choose the appropriate option for the media you wish to upload for proof of your work
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