Susan Mars, a recent graduate of Bells accounting program, evaluated the operating performance of Sunland Companys six divisions. Susan made the following presentation to Sunlands board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated, she said, our total profits would increase by $27,000.

		The Other Five Divisions		Percy Division			Total
Sales		$1,665,000		$100,000			$1,765,000
Cost of goods sold		978,300		76,600			1,054,900
Gross profit		686,700		23,400			710,100
Operating expenses		528,100		50,400			578,500
Net income		$158,600		$ (27,000	)		$131,600

In the Percy Division, cost of goods sold is $60,100 variable and $16,500 fixed, and operating expenses are $29,200 variable and $21,200 fixed. None of the Percy Divisions fixed costs will be eliminated if the division is discontinued. Is Susan right about eliminating the Percy Division? Prepare a schedule to support your answer. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Continue		Eliminate		Net Income Increase (Decrease)
Sales		$enter a dollar amount		$enter a dollar amount		$enter a dollar amount
Variable costs
Cost of goods sold		enter a dollar amount		enter a dollar amount		enter a dollar amount
Operating expenses		enter a dollar amount		enter a dollar amount		enter a dollar amount
Total variable		enter a total amount for section one		enter a total amount for section one		enter a total amount for section one
Contribution margin		enter a total amount for the first part		enter a total amount for the first part		enter a total amount for the first part
Fixed costs
Cost of goods sold		enter a dollar amount		enter a dollar amount		enter a dollar amount
Operating expenses		enter a dollar amount		enter a dollar amount		enter a dollar amount
Total fixed		enter a total amount for section two		enter a total amount for section two		enter a total amount for section two
Net income (loss)		$enter a total net income or loss amount		$enter a total net income or loss amount		$enter a total net income or loss amount

Susan is select an option incorrectcorrect