Ch 13 HW 3 5 points Saved Problem 13-26A (Algo) Eliminating a segment LO 13-4 Adams Boot Co. sells men's, women's, and children's boots. For each type of boot sold, it operates a separate department that has its own manager. All departments are housed in a single store. In recent years, the children's department has operated at a net loss and is expected to continue to do so. Last year's income statements follow. Men's Department Women's Department Children's Department eBook Sales Cost of goods sold Print Gross margin Department manager's salary Sales commissions Rent on store lease Store utilities Net income (loss) References Mc Graw Hill Required $ 610,000 (266,000) $ 430,000 (176,800) $170,000 (97,375) $ 156,800 344,000 (53,000) (107,200) (22,000) (5,000) $ 107,600 253,200 72,625 (42,000) (22,000) (76,600) (28,400) (22,000) (22,000) (5,000) (5,000) $ (4,775) a. Calculate the contribution to profit. Determine whether to eliminate the children's department. b-1. Calculate the net income for the company as a whole with the children's department. b-2. Confirm the conclusion you reached in Requirement a by preparing income statements for the company without the children's department. c. Eliminating the children's department would increase space available to display men's and women's boots. Suppose management estimates that a wider selection of adult boots would increase the store's net earnings by $33,000. Would this information affect the decision that you made in Requirement a? Complete this question by entering your answers in the tabs below. Required A Required B1 Required B2 Required C Calculate the contribution to profit. Determine whether to eliminate the children's department. Contribution to profit (loss) Should the children's department be eliminated? < Required A Required B1 > < Prev 3 of 3 Next > Help Save & Exit Submit Check my work