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The operations of Superior Corporation are divided into the Northrup Division and the Hawley Division. Projections for the next year are as follows: Northrup Division
The operations of Superior Corporation are divided into the Northrup Division and the Hawley Division. Projections for the next year are as follows:
Northrup Division | Hawley Division | Total | |
Sales | $570,000 | $430,000 | $1,000,000 |
Less Variable costs | 197,500 | 235,000 | 432,500 |
Contribution margin | $372,500 | $195,000 | $567,500 |
Less Direct fixed costs | 160,500 | 142,500 | 303,000 |
Segment margin | $212,000 | $52,500 | $264,500 |
Less Allocated common costs | 84,000 | 76,000 | 160,000 |
Operating Income (loss) | $128,000 | $(23,500) | $104,500 |
Operating income for Superior Corporation, as a whole, if the Hawley Division were dropped would be
A. $151,500
B. $52,000
C. $128,000
D. $104,500
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