The Kelsh Company has two divisions--North and South. The divisions have the following revenues and expenses:

Business

1 answer:

weqwewe [10]3 years ago

4 0

Answer:

Company should not eliminate the North division.

Explanation:

Division B is individually making loss. Overall the company is making profit of $50,000.

After eliminating the North division the overall profit will be converted into the loss of $140,000, because the common corporate expenses were shared by the both divisions, eliminating one cause the whole expense to be allocated to a single division.

Company should not eliminate the division as it will increase the total loss.

Working for on which decision is based is attached with this answer please find it.

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