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Veronica Mars, a recent graduate of Bells accounting program, evaluated the operating performance of Dunn Companys six divisions. Veronica made the following presentation to Dunns board of directors and suggested the Percy Division be eliminated. If the Percy Division is eliminated, she said, our total profits would increase by $ 26,900.

		The Other Five Divisions		Percy Division			Total
Sales		$ 1,665,000		$ 100,600			$ 1,765,600
Cost of goods sold		978,700		77,000			1,055,700
Gross profit		686,300		23,600			709,900
Operating expenses		527,200		50,500			577,700
Net income		$ 159,100		$ ( 26,900	)		$ 132,200

In the Percy Division, cost of goods sold is $ 59,200 variable and $ 17,800 fixed, and operating expenses are $ 31,600 variable and $ 18,900 fixed. None of the Percy Divisions fixed costs will be eliminated if the division is discontinued. Is Veronica right about eliminating the Percy Division? Prepare a schedule to support your answer. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Continue		Eliminate		Net Income Increase (Decrease)
Sales		$ enter a dollar amount		$ enter a dollar amount		$ enter a dollar amount
Variable costs
Cost of goods sold		enter a dollar amount		enter a dollar amount		enter a dollar amount
Operating expenses		enter a dollar amount		enter a dollar amount		enter a dollar amount
Total variable		enter a total of the two previous amounts		enter a total of the two previous amounts		enter a total of the two previous amounts
Contribution margin		enter a dollar amount		enter a dollar amount		enter a dollar amount
Fixed costs
Cost of goods sold		enter a dollar amount		enter a dollar amount		enter a dollar amount
Operating expenses		enter a dollar amount		enter a dollar amount		enter a dollar amount
Total fixed		enter a total of the two previous amounts		enter a total of the two previous amounts		enter a total of the two previous amounts
Net income (loss)		$ enter a dollar amount		$ enter a dollar amount		$ enter a dollar amount

Veronica is select an optionselect an option incorrectcorrect

Veronica Matsa recen graduate uf Beli sattun tin prograrn, evaluated he c erating per for mance Di Dunn Cumparry's six " sicris Veronica m2de tht following presentation to Dunn's board of directors and suggested the Percy Division be eliminated. "If the Percy Division is eliminsted," she said, 'our total profts would increasa by $26,900 Grades The Other Five Divisions Percy Total 1665.000 978,700 686,300 527,200 $159,100 $ 100600 Salrs Cost of goads sol Gress profit Operating expenses Net income 77.000 23600 50.500 $126,900) 1.765,600 1.055,700 709,900 $132,200 Iri the Percy Divisio, cust of goods sold is $59,200 variable and $17,800 fd and oper ating experses are$31.600 variable and $18,900 fuxed. None of the Percy Division's fixed costs will be eliminated if the division is discontinued Is Veronica right ahnut eliminating the Percy Division? Prrpar a schedule to support yaur answer (Ender negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. 145)) Net Income Veriable cests Cost of goods sold Total variable Contribution margin Fixrd costs Cost of goads sol Ocerating expenses lype here to search