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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Suresh Co. expects its five departments to yield the following income for next year.
|
Sales |
Dept. M |
Dept. N |
Dept. O |
Dept. P |
Dept. T |
|
Expenses |
$31,500 |
$17,500 |
$28,000 |
$21,000 |
$14,000 |
|
Avoidable |
4,900 |
18,200 |
11,200 |
7,000 |
18,900 |
|
Unavoidable |
25,900 |
6,300 |
2,100 |
14,700 |
4,900 |
|
Total expenses |
30,800 |
24,500 |
13,300 |
21,700 |
23,800 |
|
Net income (loss) |
$700 |
($7,000) |
$14,700 |
($700) |
($9,800) |
Recompute and prepare the departmental income statements (including a combined total column) for the company under each of the following separate scenarios: Management (1) does not eliminate any department, (2) eliminates departments with expected net losses, and (3) eliminates departments with sales dollars that are less than avoidable expenses. Explain your answers to parts 2 and 3.
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