The Operations of Balance Corporation Are Divided into the Kaplan

question 54

Essay

The operations of Balance Corporation are divided into the Kaplan Division and the Norton Division. Projections for the next year are as follows:

Required:
a. Operating income for Balance Corporation, as a whole, if the Norton Division were dropped would be:
b. If the Norton Division were dropped, Kaplan Division's sales would increase by 45%. If this happened, the operating income for Balance Corporation as a whole would be:

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Definitions:

Total Dollar Amount

The sum total in dollar value of all items considered in a transaction, report, or calculation.

Level Of Activity

A measurement of the amount of work or action in a specific area, often used in accounting or project management to quantify the extent of operations or tasks.

Cost Behavior

The way in which costs change in relation to changes in a business' levels of activity or production volume.

Related Activity

Activities or actions that are associated with or pertinent to a main activity or topic.