This is question 7

D Question 7 20 pts Company K has two divisions whose most recent financial information is below. Company K is considering eliminating Division 1. Division 1 Division 2 Total Sales 50,000 400,000 450,000 Variable Material Costs 30,000 175,000 205,000 Allocated Corporate Fixed 12,500 75,000 87.500 Variable Labor Costs 7,000 40,000 47,000 Division Specific Fixed Costs 4,000 12,500 16,500 A. If Company K decides to keep Division 1, what is the total net income reported by Company K? B. If Company K decides to eliminate Division 1, what is the total net income reported by Company K? C. Should Company K eliminate Division 1? Why? D. What is the minimum sales revenue that Division 1 must earn if it is NOT to be eliminated? Edit View Insert Format Tools Table 12pt ~ Paragraph | B I U A LV TV Q V E V