Problem: Module 6 Textbook Problem 7 Learning Objective: 6-4 Make appropriate segment elimination decisions Zachary Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated ZACHARY COMPANY Income Statements for Year 2 Segment Sales Cost of goods sold Sales commissions Contribution margin General fixed operating expenses (allocation of president's salary) Advertising expense (specific to individual divisions) Net Income (los) $ 166,000 (131,000) (19.000) 16,000 (41,000) (4.000) S (29,000) B $241,000 (74,000) (28,000) 139,000 (36,000) (13,000) $ 90,000 $246,000 (82,000) (25,000) 139,000 (29,000) 0 $110,000 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 Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Sales Eect on income Required A Required 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. ZACHARY COMPANY Comparative Income Statements for the Year 2 Decision Keep Seg. A Eliminate Seg. A Sales Cost of goods sold Sales commissions Contribution margin Generalfoxed operating expenses Advertising expense Net Income