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Wellco Corporation currently has two divisions which had the following operating results for last year: Sales Variable costs Contribution margin Traceable fixed costs Allocated common

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Wellco Corporation currently has two divisions which had the following operating results for last year: Sales Variable costs Contribution margin Traceable fixed costs Allocated common fixed costs Net operating income Total $920000 460000 $ 460000 275000 125000 Division 1 $ 580000 240000 $340000 AE210000 80000 Division 2 $340000 220000 $120000 65000 45000 $ 60000 $ 50000 $ 10000 Due to poor performance, Wellco is considering eliminating Division 2. All of Division 2's variable costs and traceable fixed costs are avoidable, but none of its allocated common corporate fixed costs are Division 2 had been dropped at the beginning of last year, Welco's net income would have been

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