Question: Granfield Company is considering eliminating its backpack division, which reported a loss for the recent year of $45,000 as shown below. Segment Income (Loss)

Granfield Company is considering eliminating its backpack division, which reported a loss

Granfield Company is considering eliminating its backpack division, which reported a loss for the recent year of $45,000 as shown below. Segment Income (Loss) Sales $ 972,000 Variable costs Contribution margin Fixed costs Income (loss) 481,000 491,000) 536,000 $ (45,000) If the backpack division is dropped, all $481,000 of its variable costs are avoidable, and $214,400 of its fixed costs are avoidable. The impact on Granfield's income from eliminating this business segment would be:

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