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What is incremental effecton net income if division dropped

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Reference no: EM133002633

South Division has the following information:

Sales $800,000

Variable expenses 450,000

Fixed expenses380,000

Problem 1: If this division is eliminated, $70,000 of the fixed expenses will be allocated to the company's other divisions. What is the incremental effecton net income if the division is dropped?

A $40,000 decrease

B. $30,000 increase

C. $30,000 decrease

D. $40,000 increase

E. $310,000 increase

Reference no: EM133002633

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