& points Save Arower Question & Karim Ahmed a recent graduate of an accounting program, evaluated the operating performance of Lunar Company's four divisions, Karim Ahmed made the following presentation to the Lunar board of directors and suggested the Riffa Division be eliminated. "If the Riffa Division is eliminated," she said, "our total profits would increase by $10,000. The Other Four Riffa Divisions Division $1,300,000 590,000 Sales Cost of goods sold 600,000 65,000 Gross profe 700.000 25,000 350,000 35,000 Operating expenses Not income $350,000 ($10,000) In the Rifta Division, cost of goods sold is $45,000 variable and $20,000 fixed, and operating expenses are $20,000 variable and $15,000 fixed. None of the Riffa Division's fixed costs will be eliminated if the division is discontinued. Required: (1) Prepare an incremental analysis to eliminate or keep a division decision. (6.5 marks) (2) is Karim Ahmed right about eliminating the Riffa Division? Why or why not? (1.5 marks) For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac BIVS Paragraph V Arial 10pt IEE I. bl