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Thornton Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. THORNTON COMPANY Income Statements

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Thornton Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. THORNTON COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income floss) $ 165,000 $245,000 (130,000) (76,000) (15,000) (28,000) 20,000 141,000 (38,000) (40,000) (6.000) (14,000) $ (24,000) $ 87,000 $245,000 (86,000) 23,000) 136,000 (36,000) 0 $100,000 Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Required a. Prepare a schedule of relevant sales and costs for Segment A. b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2 the elimination of Segment A. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Cost of goods sold Sales commissions Advertising expense Effect on income $ 0 (Required A Required B A N O

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