The Cook Corporation has two divisions-East and West. The divisions have the following revenues and expenses: East $ 550,000 198,000 169,500 117,500 $ 65,000 Sales Variable costs Traceable fixed costs Allocated common corporate costs. Net operating income (loss) The management of Cook is considering the elimination of the West Division. If the West Division were eliminated, its traceable fixed costs could be avoided. Total common corporate costs would be unaffected by this decision. Given these data, the elimination of the West Division would result in an overall company net operating income (loss) of: Multiple Choice $(76,100) $(39,500) $65,000 West $ 489,500 258,500 194,400 141, 100 $ (104,500) $(104,500)

The Cook Corporation has two divisions-East and West. The divisions have the following revenues and expenses: East $ 550,000 198,000 169,500 117,500 $ 65,000 Sales Variable costs Traceable fixed costs Allocated common corporate costs. Net operating income (loss) The management of Cook is considering the elimination of the West Division. If the West Division were eliminated, its traceable fixed costs could be avoided. Total common corporate costs would be unaffected by this decision. Given these data, the elimination of the West Division would result in an overall company net operating income (loss) of: Multiple Choice $(76,100) $(39,500) $65,000 West $ 489,500 258,500 194,400 141, 100 $ (104,500) $(104,500)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The ABC Corporation has two divisions-East and West The divisions have the following revenues and expenses Sales Variable costs Traceable fixed costs Allocated common corporate costs Net operating income (loss) Muple Choice $141400 The management of ABC is considering the elimination of the West Division. If the West Division were eliminated, its traceable fixed costs could be avoided Total common corporate costs would be unaffected by this decision Geven these data, the elimination of the West Division would result in an overall company net operating income foss) of $45.600) $1400 East $ 595,000 $140,000) 180,000 144,000 129,600 $141,400 West $ 445,500 236,500 203,400 187,000 $ (181,400) a
Bran Corporation plans to discontinue a division that generates a total contribution margin of $40,000 per year. Fixed overhead associated with this division is $150,000, of which $100,000 cannot be eliminated. What will be the impact on Bran's overall profitability if the division is discontinued? Increase by $60,000. None of these. Decrease by $60,000. Increase by $10,000. Decrease by $10,000.
Subject :- Accounting
Coronado Division has the following data: Sales Variable expenses Fixed expenses $509000 231000 286000 The fixed costs are not avoidable and must be allocated to profitable divisions if the segment is eliminated. What will be the incremental effect on net income if Coronado Division is eliminated? O $223000 increase O $278000 decrease O $286000 decrease Cannot be determined from the data provided
None
4. If a transfer price of $340 per unit is negotiated, how much would the income from operations of each division and total company income from operations increase? The Semiconductors Division's income from operations would increase by$fill in the blank 75932002afef041_1 The Navigational Systems Division's income from operations would increase by$fill in the blank 75932002afef041_2 Exoplex Industries Inc.'s total income from operations would increase by$fill in the blank 75932002afef041_3 5a. What is the range of possible negotiated transfer prices that would be acceptable for Exoplex Industries Inc.? Any transfer price than the Semiconductors Division’s variable expenses per unit but than the market price would be acceptable. 5b. Assuming that the managers of the two divisions cannot agree on a transfer price, what price would you suggest as the transfer price?$fill in the blank 75932002afef041_6