Question: A manufacturer is considering eliminating a segment because it shows the following $6,400 loss. All $21,400 of its variable costs are avoidable, and $39,200

A manufacturer is considering eliminating a segment because it shows the following

A manufacturer is considering eliminating a segment because it shows the following $6,400 loss. All $21,400 of its variable costs are avoidable, and $39,200 of its fixed costs are avoidable. Segment Income (Loss) Sales Variable costs Contribution margin Fixed costs Income (loss) $ 64,200 21,400 42,800 49,200 (6,400) (a) Compute the income increase or decrease from eliminating this segment. (b) Should the segment be eliminated?

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