A segment has the following data:

What will be the incremental effect on net income if this segment is eliminated,assuming the fixed costs will be allocated to profitable segments?
A)$284,500 increase
B)$386,000 decrease
C)$264,000 decrease
D)$365,500 decrease

Question

A segment has the following data:

What will be the incremental effect on net income if this segment is eliminated,assuming the fixed costs will be allocated to profitable segments?
A)$284,500 increase 
B)$386,000 decrease 
C)$264,000 decrease 
D)$365,500 decrease

Quizplus · Accepted Answer

Change in net income = $650,000 - $386,000 = $264,000 decrease

A Segment Has the Following Data