Vanik Corporation Currently Has Two Divisions Which Had the Following

question 104

Multiple Choice

Vanik Corporation currently has two divisions which had the following operating results for last year: Because the Rubber Division sustained a loss, the president of Vanik is considering the elimination of this division. All of the division's traceable fixed costs could be avoided if the division was dropped. None of the allocated common corporate fixed costs could be avoided. If the Rubber Division was dropped at the beginning of last year, the financial advantage (disadvantage) to the company for the year would have been:

• A) ($20,000)
• B) $20,000
• C) $25,000
• D) ($25,000)

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Definitions:

Polarized

Referring to light or electromagnetic radiation that oscillates in a specific direction or plane.

Mechanism

The detailed step-by-step description of how a chemical reaction occurs, including the breaking and formation of bonds.

Reaction

A process in which one or more substances (the reactants) are converted to one or more different substances (the products).

Terpene

A class of natural organic compounds, typically derived from plants, with a structure based on isoprene units.