A segment has the following data: Sales $790000 Variable expenses 345000 Fixed expenses 550000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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A segment has the following data:

Sales $790000
Variable expenses 345000
Fixed expenses 550000


What will be the incremental effect on net income if this segment is eliminated, assuming the fixed expenses will be allocated to profitable segments?

$345000 increase
$445000 decrease
Cannot be determined from the data provided
$5750 decrease
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