WHETHER TO DISCONTINUE A DEPARTMENT Mueller and Kenington Company is trying to decide whether to discontinue department A. Operating results for the year just ended for each of the company's three departments and for the entire operation are as follows:

REQUIRED
1. Prepare an additional column that combines departments B and C only.
2. Review all data and decide if department A should be discontinued. Defend yourdecision.

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Dept. B Dept. A Dept. C Total Net sales Cost of goods sold Gross profit Direct operating expenses Departmental direct operating margin Indirect operating expenses Operating income (loss) $680,000 $730,000 $690,000 $2,100,000 400,000 380,000 360,000 1,140,000 $330,000 $ 960,000 680,000 $280,000 $350,000 230,000 240,000 210,000 $ 50,000 $110,000 $120,000 $ 280,000 70,000 $ 50,000 $ 70,000 $ (20,000) $ 40,000 210,000 70,000