The Operations of Winston Corporation Are Divided into the Blink

question 45

Multiple Choice

The operations of Winston Corporation are divided into the Blink Division and the Blur Division. Projections for the next year are as follows:
$\begin{array}{llr}&\text { Blink Division }&\text { Blur Division }&\text { Total }\\ \text { Sales} &\$280,000&\$168,000&\$448,000\\ \text { Variable costs } &98,000&77,000&175,000\\ \text { Contribution margin } &\$182,000&\$91,000&\$273,000\\ \text { Direct fixed costs} &84,000&70,000&154,000\\ \text { Segment margin} &\$98,000&\$21,000&\$119,000\\ \text { Allocated common costs} &42,000&31,500&73,500\\ \text { Operating income (loss) } &\$56,000&\$(10,500) &\$45,500\\\end{array}$

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If the Blur Division were dropped, Blink Division's sales would increase by 30%. If this happened, the operating income for Winston Corporation as a whole would be:

• A) $72,800.
• B) $56,000.
• C) $79,100.
• D) $59,150.

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Definitions:

Indian Problem

A term that historically referred to the challenge faced by European settlers and later the United States government in dealing with the indigenous populations of North America.

Indian Removal Act

A law passed in 1830 that authorized the forced relocation of Native American tribes from their ancestral lands in the southeastern United States to areas west of the Mississippi River.

Georgia

A state in the southeastern United States known for its diverse geography, ranging from mountains to beaches, and its rich history, including its role as a Confederate state during the Civil War and as a center of the civil rights movement.

Cherokee

A Native American people originally from the southeastern United States, known for their rich culture and history.