Judy Jean, a recent graduate of Rolling€™s accounting program, evaluated the operating performance of Artie Company€™s six divisions. Judy made the following presentation to Artie€™s board of directors and suggested the Huron Division be eliminated. €œIf the Huron Division is eliminated,€ she said, €œour total profits would increase by $26,000.€

In the Huron Division, cost of goods sold is $61,000 variable and $15,000 fixed, and operating expenses are $26,000 variable and $24,000 fixed. None of the Huron Division€™s fixed costs will be eliminated if the division is discontinued.

Instructions
Is Judy right about eliminating the Huron Division? Prepare a schedule tosupport

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The Other Five Divisions $1,664,200 978,520 685,680 527,940 157,740 Huron Division Total Sales Cost of goods sold Gross profit Operating expenses Net income $100,000 $1,764,200 1,054,520 709,680 577,940 $ (26,000) 131,740 76,000 24,000 50,000