Anheiser has three divisions: Bud, Wise, and Er. The results of May, 2010 are presented below: Bud Wise Er Total Units sold 3,000 5,000 2,000 10,000 Revenue $70,000 $50,000 $40,000 $160,000 Less variable costs 32,000 26,000 16,000 74,000 Less direct fixed costs 14,000 19,000 12,000 45,000 Less allocated fixed costs 6,000 10,000 4,000 20,000 Net income $18,000 ($5,000) $ 8,000 $21,000 All of the allocated costs will continue even if a division is discontinued. Anheiser allocates indirect fixed costs based on the number of units to be sold. Since the Wise division has a net loss, Anheiser feels that it should be discontinued. Anheiser feels if the division is closed, that sales at the Bud division will increase by 20%, and that sales at the Er division will stay the same. Instructions A. Prepare an analysis showing the effect of discontinuing the Wise division. B. Should Anheiser close the Wise division? Briefly indicate why or why not.