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Ackerman Company is contemplating discontinuing one of its departments. The department has sales of $150,000...

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Accounting

Ackerman Company is contemplating discontinuing one of its departments. The department has sales of $150,000 per year. Variable costs are $70,000. Fixed costs incurred by the department are $105,000 per year of which $45,000 are unavoidable even if the department is discontinued. What is the increase (or decrease) in Net Income that would result from eliminating the department?
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