Franklin, Inc. has two divisions, Seward and Charles. Following is the income statement for the previous year:

	Seward		Charles
Sales	$	937,800		$	625,200
Variable Costs		609,320			562,680
Contribution Margin	$	328,480		$	62,520
Fixed Costs		159,300			159,300
Profit Margin	$	169,180		$	(96,780	)

Of the total fixed costs, $310,000 are common fixed costs that are allocated equally between the divisions. What would Franklin's profit margin be if Charles were dropped?

Multiple Choice

• $937,800

• $169,180

• $14,180

• $328,480

Answer rating: 100% (QA)

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