Business

Eugene

1 March, 20:59

Managers are evaluating the performance of Benson Company's six divisions. The managers are considering discontinuing its Mason Division because it is currently operating at a loss. Below is its cost and profit information: The Other Five Divisions Mason Division Total Sales $1,664,200 $96,200 $1,760,400 Variable Costs $1,178,520 $85,000 $1,263,520 Contribution Margin $485,680 $11,200 $496,880 Fixed Costs $327,940 $35,070 $363,010 Operating Income $157,740 ($23,870) $133,870 If the Mason Division is eliminated, $26,400 of fixed costs will be eliminated. Should the Mason Division be eliminated? A. No, because operating income will decrease by $11,200

B. Yes, because operating income will increase by $23,870

C. No, because operating income will decrease by $96,200

D. Yes, because operating income will increase by $15,200