Rock Inc. has three divisions, Granite, Lime and Nina. All fixed costs are unavoidable Following...
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Rock Inc. has three divisions, Granite, Lime and Nina. All fixed costs are unavoidable Following is the income statement for the previous year: Sales Variable costs Contribution Margin Fixed Costs (allocated) Profit Margin Granite $ 502,000 195,000 307,000 260,000 $ 47,000 Lime Nina $ 271,500 $225,000 124,400 100, 200 147,100 124,800 156,250 119,750 $ (9,150) $ 5,050 Total $998,500 419,600 578,900 536,000 $ 42,900 a. What would Rock's profit margin be if the Lime division were dropped? b. What would Rock's profit margin be if the Nina division were dropped? C
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