A Study Has Been Conducted to Determine If One of the Departments

question 125

Multiple Choice

A study has been conducted to determine if one of the departments in Parry Company should be discontinued.The contribution margin in the department is $50,000 per year.Fixed expenses charged to the department are $65,000 per year.It is estimated that $40,000 of these fixed expenses could be eliminated if the department is discontinued.These data indicate that if the department is discontinued,the company's overall net operating income would:

• A) decrease by $10,000 per year.
• B) increase by $10,000 per year.
• C) decrease by $25,000 per year.
• D) increase by $25,000 per year.

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Definitions:

Unique Identity

A distinct characteristic or combination of characteristics that distinguishes an individual, group, or entity from others.

Institutional Adaptation

Institutional adaptation refers to the adjustments that institutions make to cope with external shifts or internal developments, aiming to maintain stability and continue serving their functions effectively.

Multibased Socialization

The process through which individuals learn and adopt the values, norms, and required behaviors of multiple groups within an organization.

Informal Networks

The social and professional connections that exist outside of formal organizational structures, often facilitating information flow.