Question: my Work Exercise 6-14A (Algo) Segment elimination decision LO 6-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be


my Work Exercise 6-14A (Algo) Segment elimination decision LO 6-4 Benson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. BENSON COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold Salles commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net income (Loss) A B $ 169,000 $241,000 (128,000) (86,000) (23,000) (23,000) 18,000 132,000 (40,000) (48,000) (3,000) (17,000) $ (25,000) $ 67,000 C $260,000 (95,000) (22,000) 143,000 (35,000) $108,000 Required a. Prepare a schedule of relevant sales and costs for Segment A b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A Complete this question by entering your answers in the tabs below. Required A Required B ces Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Cost of goods sold Sales commissions Advertising oxponse Effect on income $ Required B lete this questio oy cerin W. ook rint Required A Required B arences Prepare comparative income statements for the company as a whole under two alternatives: (1) the and (2) the elimination of Segment A. BENSON COMPANY Comparative Income Statements for the Year 2 Decision Keep Seg. A Eliminate Seg. A Sales Cost of goods sold Sales commissions Contribution margin os General fixed operating expenses Advertising expense Net Income $ 0 $ 0 0
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