Analyze the following divisions of Johannes' Clothing Company. Management has to make a decision whether to close one of the divisions or keep both open. Make a recommendation to management based on the information given. Of the fixed costs, parts are controllable within the divisions, but $31,000 of the total are company headquarters fixed costs. Of these, $16,000 are allocated to the Skirt Division and $15,000 to the Shirt Division. $\begin{array} { l r r r }
& \text { Skirt } & \text { Shirt } & \text { Total } \
\text { Sales } & \$ 102,000 & \$ 89,000 & \$ 191,000 \
\text { Variable manufacturing costs } & 57,120 & 53,400 & 110,520 \
\text { Variable selling costs } & 4,600 & 3,700 & 8,300 \
\text { Fixed costs (manufacturing and selling) } & 38,200 & 35,300 & 73,500
\end{array}$

Question

Analyze the following divisions of Johannes' Clothing Company. Management has to make a decision whether to close one of the divisions or keep both open. Make a recommendation to management based on the information given. Of the fixed costs, parts are controllable within the divisions, but $31,000 of the total are company headquarters fixed costs. Of these, $16,000 are allocated to the Skirt Division and $15,000 to the Shirt Division. $\begin{array} { l r r r } 
& \text { Skirt } & \text { Shirt } & \text { Total } \
\text { Sales } & \$ 102,000 & \$ 89,000 & \$ 191,000 \
\text { Variable manufacturing costs } & 57,120 & 53,400 & 110,520 \
\text { Variable selling costs } & 4,600 & 3,700 & 8,300 \
\text { Fixed costs (manufacturing and selling) } & 38,200 & 35,300 & 73,500
\end{array}$

Quizplus · Accepted Answer

The Answer of Analyze the following divisions of Johannes' Clothing Company. Management has to make a decision whether to close one of the divisions or keep both open. Make a recommendation to management based on the information given. Of the fixed costs, parts are controllable within the divisions, but $31,000 of the total are company headquarters fixed costs. Of these, $16,000 are allocated to the Skirt Division and $15,000 to the Shirt Division. $\begin{array} { l r r r } 
& \text { Skirt } & \text { Shirt } & \text { Total } \
\text { Sales } & \$ 102,000 & \$ 89,000 & \$ 191,000 \
\text { Variable manufacturing costs } & 57,120 & 53,400 & 110,520 \
\text { Variable selling costs } & 4,600 & 3,700 & 8,300 \
\text { Fixed costs (manufacturing and selling) } & 38,200 & 35,300 & 73,500
\end{array}$

Analyze the Following Divisions of Johannes' Clothing Company