Question: X Corp has three segments; A,B and C. The segment margin of A, B and C are 11,000, 12,000 and 9,000, respectively. Allocated fixed cost

X Corp has three segments; A,B and C. The segment margin of A, B and C are 11,000, 12,000 and 9,000, respectively. Allocated fixed cost (common cost) of A is 30% of the total common cost. Segment A has operating income of 7,000 before tax. X needs to eliminate one segment because of decrease in company demand. Tax rate is 25%. What will be the overall corporation net income before tax (operating income) after eliminating the appropriate segment?

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