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(Brickman's Pharmacy sells a variety of products. The business is divided into four segments or...

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Accounting

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(Brickman's Pharmacy sells a variety of products. The business is divided into four segments or departments for reporting purposes. The departments and their operating results are shown below:) Pharmaceuticals Cosmetics Grocery Household Sales Revenue $ 600,000 $300,000 $ 200,000 $ 400,000 Variable Costs 425,000 200,000 170,000 250,000 Contribution Margin $ 175,000 $100,000 $30,000 $ 150,000 Fixed Costs 80,000 40,000 80.000 60,000 $40,000 Net Income (Loss) $ 95,000 $(10,000) $ 70,000 ------ - Lapuyul. (The fixed costs consist of insurance, property taxes, interest, and other costs that will not be eliminated if a department is discontinued. Brickman's management is considering eliminating the grocery department. Assuming sales in the other departments will not be affected by dropping the grocery department, what will be the effect on the company's total operating income?) TTT

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