Question: Carns Company is considering eliminating its Small Tools Division, which reported a loss for the prior year of $255,000 as shown below. Sales Segment

Carns Company is considering eliminating its Small Tools Division, which reported a loss for the prior year of $255,000 as shown below. Sales Segment Income (Loss)) Variable costs Contribution margin Fixed costs Income (loss) $ 1,480,000 1,345,000 135,000 390,000 $ (255,000) If the Small Tools Division is dropped, all of its variable costs are avoidable, and $117,000 of its fixed costs are avoidable. The impact on Carns's income from eliminating the Small Tools Division would be:

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