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The Kelsh Company has two divisions--North and South. The divisions have the following revenues and expenses: North South Sales $1,060,000 $976,000 Variable Expenses $522,000 $348,000
The Kelsh Company has two divisions--North and South. The divisions have the following revenues and expenses:
North | South | |
Sales | $1,060,000 | $976,000 |
Variable Expenses | $522,000 | $348,000 |
Traceable Fixed Expenses | $356,000 | $290,000 |
Allocated Common Corporate Expenses | $256,000 | $206,000 |
Net Operating Income (Loss) | $(74,000) | $132,000 |
Management at Kelsh is pondering the elimination of North Division. If North Division were eliminated, its traceable fixed expenses could be avoided. The total common corporate expenses would be unaffected. Given these data, the elimination of North Division would result in overall income of the company increasing (decreasing) by:
Group of answer choices
$132,000
$74,000
($182,000)
$58,000
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