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The operations of Hart Corporation are divided into the Will Division and the Aloy Division Projections for the next year are as follows: Will Division
The operations of Hart Corporation are divided into the Will Division and the Aloy Division Projections for the next year are as follows: Will Division Aloy Division Total Sales $560,000 $336,000 $896,000 Less: Variable costs 196.000 154.000 350.000 Contribution margin $364,000 $182,000 $546,000 Less Direct fixed costs 168.000 140.000 308.000 Segment margin $196,000 $ 42,000 $238.000 Less: Allocated common cost 84.000 63,000 147.000 Operating income (loss) $112.000 $121.000) 591.000 The firm is considering dropping the Aloy line, so, the allocated common costs will as a whole, terrain and be reallocated to the Will If this occurs operating income for Hart Corporation, as a whole, if the Aloy Division were dropped would be A. $133,000 B. 5112,000 C. $91,000 D. $49,000
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