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Question
A company expects its three departments to yield the following income for next year:
| Dept. A | Dept. B | Dept. C | |
| Sales | $6,000 | $5,000 | 6,800 |
| Expenses | |||
| Avoidable | 2,000 | 1,000 | 4,000 |
| Unavoidable | 1,500 | 3,000 | 2,500 |
| Total expenses | 3,500 | 4,000 | 6,500 |
| Net income (loss) | $2,500 | $1,000 | $300 |
Compute the change to the companys total net income if Dept. C is eliminated.
A. $300 decrease
B. $300 increase
C. $2,800 decrease
D. $2,800 increase
E. $6,800 decrease
Answer
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