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

ZACHARY COMPANY

Income Statements for Year $2$

Segment A B C

Sales $ $166,000$ $ $249,000$ $ $254,000$

Cost of goods sold $(129,000)(84,000)(92,000)$

Sales commissions $(19,000)(24,000)(22,000)$

Contribution margin $18,000141,000140,000$

General fixed operating expenses $($allocation of president$$s salary$)(35,000)(35,000)(26,000)$

Advertising expense $($specific to individual divisions$)(3,000)(15,000)0$

Net income $($loss$)$ $ $(20,000)$ $ $91,000$ $ $114,000$

Required

Prepare a schedule of relevant sales and costs for Segment A$.$

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$.$

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