A company expects its three departments to yield the following income for next year.

Compute the change to the company's total net income if Dept. C is eliminated.

Question

A company expects its three departments to yield the following income for next year.

Compute the change to the company's total net income if Dept. C is eliminated.

Quizplus · Accepted Answer

Eliminating Dept. C would result in a decrease in income by $2,800. Since the question asks for the change in total net income, we need to add up the income from all three departments with and without Dept. C. The income without Dept. C would be $9,600 + $15,200 = $24,800. The income with Dept. C is $24,800 + $2,800 = $27,600. Therefore, the change in net income would be $27,600 - $24,800 = $2,800 decrease.

A Company Expects Its Three Departments to Yield the Following