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  3. bed \& bath, a retailing company, has two depa

Bed \& Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent...

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Accounting

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Bed \& Bath, a retailing company, has two departments-Hardware and Linens. The company's most recent monthly contribution forma income statement follows: A study indicates that $378,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even if the Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 12% decrease in the sales of the Hardware Department. Required: What is the total financial impact of discontinuing the Linens Department? (See below if you need a hint.)

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