A firm contemplates to drop a segment that shows a contribution margin of P25,000. Overhead allocated to the segment amounts to P40,000 of which P17,500 cannot be eliminated. What is the effect of this discontinuance on the company’s profit before tax? (Indicate if increase or decrease, e.g. “2,000 increase” or “2,000 d
A firm contemplates to drop a segment that shows a contribution margin of P25,000. Overhead allocated to the segment amounts to P40,000 of which P17,500 cannot be eliminated. What is the effect of this discontinuance on the company’s profit before tax? (Indicate if increase or decrease, e.g. “2,000 increase” or “2,000 d
Chapter10: Short-term Decision Making
Section: Chapter Questions
Problem 12MC: Youngstown Construction plans to discontinue its rooting segment. Last year, this segment generated...
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A firm contemplates to drop a segment that shows a contribution margin of P25,000.
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