View PoliciesCurrent Attempt in Progress

Nancy Jackson, a recent graduate of Penny Worth University's accounting program, evaluated the operating performance of

Wildhorse Company's six divisions. Nancy made the following presentation to Wildhorse's board of directors and suggested the Erie

division be eliminated. $"$If the Erie division is eliminated," she said, "our total profits would increase by $$23,300."$

In the Erie division, the cost of goods sold is $$61,000$ variable and $$15,100$ fixed, and operating expenses are $$14,600$ variable and

$$33,000$ fixed. None of the Erie division's fixed costs will be eliminated if the division is discontinued.

Is Nancy right about eliminating the Erie Division? Prepare a schedule to support your answer. $($If an amount reduces the net income then

enter with a negative sign preceding the number e$.$g$.-15,000$ or parenthesis, e$.$g$.(15,000).)$

Current Attempt in Progress

On January $2,2021,$ Whispering Winds Hospital purchased a $$107,500$ special radiology scanner from Paver Inc. The scanner has a

useful life of five years and will have no disposal value at the end of its useful life. The straight$-$line method of depreciation is used on

this scanner. Annual operating costs with this scanner are $$105,000.$

Approximately one year later, the hospital is approached by Bramble Technology salesperson Elizabeth Brown, who indicates that

purchasing the scanner in $2021$ from Paver was a mistake. She points out that Bramble has a scanner that will save Whispering Winds

Hospital $$27,000$ a year in operating expenses over its four$-$year useful life. She notes that the new scanner will cost $$119,200$ and has

the same capabilities as the scanner purchased last year. The hospital agrees that both scanners are of equal quality. The new scanner

will have no disposal value. Bramble agrees to buy the old scanner from Whispering Winds Hospital for $$56,300.$

$($a$)$

Assume Whispering Winds Hospital sells its old scanner on January $2,2022.$ Calculate the gain or loss on the sale.

If Whispering Winds Hospital sells its old scanner it incurs

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Attempts: $0$ of $3$ used

$($b$)$

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