Footware, Inc., is a small manufacturer of shoes. The company has two divisions: the Sandal Division and the Moccasin Division. Data for the month of October are as follows:

Junette, the company's chief financial officer since October 1 of the current year, wants to close the unprofitable Sandal Division. She believes that doing so will benefit Footware and benefit herself, given that her end-of-year bonus is to be based on the company's overall operating income. In a recent interview, Junette summarized her business philosophy as follows: "A company is only as strong as its least profitable segment. As long as I'm at the financial helm, only the strongest shall survive at Footware."
Instructions
a. Had the Sandal Division been closed on October 1, what would the company's operating income for the month have been?
b. After learning about Junette's business philosophy, the Sandal Division's director of marketing made the following statement: "Junette may understand numbers, but she doesn't understand the complementary relationship between Sandals and Moccasins, nor the seasonal nature of our business." What did the director of marketing mean by this statement? How might such information influence Junette's assessment of the company's Sandal Division?
c. By how much would the Sandal Division's monthly sales have to increase for it to generate a positive responsibility margin of $2,000 in any given month? Show all your computations.

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Profit Centers Company Division Division Sales … 4,000 $ 7,000