Question
The ABC Company has a division that has the following income statement: Sales$5,000 Variable costs3,000 _____ Contribution Margin 2,000 Fixed Costs2,500 _____ Operating Income-500 What
The ABC Company has a division that has the following income statement:
Sales$5,000
Variable costs3,000
_____
Contribution Margin 2,000
Fixed Costs2,500
_____
Operating Income-500
What is the effect of operating this division on the operating income of the ABC Company if $800 of the fixed costs will not be avoided if the company shuts down the division? Should the ABC Company shut down the division in this case?
What is the effect of operating this division on the operating income of the ABC Company if $400 of the fixed costs will not be avoided if the company shuts down the division? Should the ABC Company shut down the division in this case?
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BMW Brand Audit
Authors: Marion Maguire
1st Edition
3638653137, 978-3638653138
