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Beverages (Pty) Ltd (Beverages) has four different divisions. One of their divisions (Energy) which produces...

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Accounting

Beverages (Pty) Ltd (Beverages) has four different divisions. One of their divisions (Energy) which produces energy drinks called LessFire has been struggling for the past three years due to intense market competition.The results of the division for the financial year ended June 2024 were as follows:
Sales R2000000
Direct Material (R1450000) Depreciation (R400000)
Salaries and wages (R650000)
= Profit/(Loss)(R500000)
Should the Energy the division be shut down the entire workforce will be retrenched at a cost of R250000.
REQUIRED:
Determine whether the Energy division should be shut down or not.Should you wish to intentionally include or omit a figure from the workings, provide a brief motivation for this decision.

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