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Shows, Inc. is considering eliminating a department that reports a contribution margin of $165000 and fixed costs of $200000. Only $120000 of the fixed costs

Shows, Inc. is considering eliminating a department that reports a contribution margin of $165000 and fixed costs of $200000. Only $120000 of the fixed costs are avoidable.

The annual financial advantage (disadvantage) for Shows of eliminating this department is:

Multiple Choice

  • $85000

  • $45000

  • $35000

  • $(45000)

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