Veronica Mars, a recent graduate of Bells accounting program, evaluated the operating performance of Dunn Companys six divisions. Veronica made the following presentation to Dunns board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated, she said, our total profits would increase by $27,200.

		The Other Five Divisions		Percy Division			Total
Sales		$1,665,000		$100,100			$1,765,100
Cost of goods sold		977,400		76,900			1,054,300
Gross profit		687,600		23,200			710,800
Operating expenses		528,700		50,400			579,100
Net income		$158,900		$ (27,200	)		$131,700

In the Percy Division, cost of goods sold is $60,000 variable and $16,900 fixed, and operating expenses are $30,800 variable and $19,600 fixed. None of the Percy Divisions fixed costs will be eliminated if the division is discontinued. Is Veronica right about eliminating the Percy Division? Prepare a schedule to support your answer.