Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The operations of Winston Corporation are divided into the Blink Division and the Blur Division. Projections for the next year are as follows: Blink Division
The operations of Winston Corporation are divided into the Blink Division and the Blur Division. Projections for the next year are as follows:
Blink Division | Blur Division | Total | |||||||||
Sales | $ | 320,000 | $ | 184,000 | $ | 504,000 | |||||
Variable costs | 106,000 | 85,000 | 191,000 | ||||||||
Contribution margin | $ | 214,000 | $ | 99,000 | $ | 313,000 | |||||
Direct fixed costs | 92,000 | 78,000 | 170,000 | ||||||||
Segment margin | $ | 122,000 | $ | 21,000 | $ | 143,000 | |||||
Allocated common costs | 47,000 | 39,500 | 86,500 | ||||||||
Operating income (loss) | $ | 75,000 | $ | (18,500 | ) | $ | 56,500 | ||||
Operating income for Winston Corporation, as a whole, if the Blur Division was dropped would be:
$93,500.
$75,000.
$56,500.
$35,500.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started