2. Product (Segment) elimination decision. The Kelsh Company has two divisions-- North and South. The divisions have the following revenues and expenses:
North South
Sales $900,000 $800,000
Variable expenses 450,000 300,000
Traceable fixed expenses 260,000 210,000
Allocated common corporate expenses 240,000 190,000
Net operating income (loss) ($50,000) $100,000
Management at Kelsh is pondering the elimination of the North Division. If the North Division were eliminated, its traceable fixed expenses could be avoided. The total common corporate expenses would be unaffected.
Given this data, the elimination of the North Division would result in an overall company
operating income of:
A) $50,000.
B) ($140,000).
C) $100,000.
D) $150,000.

R& m chatelaine is one of the largest tax-preparation firms in the united states. it wants to acquire the tax experts, a smaller rival. after the merger, chatelaine will be one of the two largest income-tax preparers in the u.s. market. what should chatelaine include in its acquisition plans? it should refocus its attention from the national to the international market. in addition to acquiring the tax experts, it should also determine the best way to drive independent "mom and pop" tax preparers out of business. chatelaine will need to explain to the federal trade commission how the acquisition will not result in an increase in prices for consumers. chatelaine should enter a price-based competition with its other major competitor to force it out of business and become a monopoly.