Division B Earns a Contribution Margin of $200,000 and Has

question 90

Multiple Choice

Division B earns a contribution margin of $200,000 and has a divisional margin of $70,000. If Division B is closed, all of the direct divisional expenses and $110,000 of common expenses can be eliminated. These facts indicate that closing the division will cause the firm's operating income to

• A)increase by $90,000.
• B)decrease by $90,000.
• C)increase by $40,000.
• D)decrease by $40,000.

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Definitions:

Casual Acquaintances

People one knows slightly, but who are not close friends.

Selective Listening

The process of listening to and processing only parts of incoming auditory messages that interest the listener, often ignoring other parts.

Overwhelmed

A state of being where an individual feels unable to manage or cope with their current emotional or physical burdens.

Red Flag Words

Terms or phrases that signal potential problems or areas of concern, often used in communication to alert to issues.