Cabby Jewelers has two divisions, the ring division and the necklace division. The ring division...
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Accounting
Cabby Jewelers has two divisions, the ring division and the necklace division. The ring division has shown a net loss of $40,000 for the past year. The necklace division has shown net income of $10,000 for that same period of time. The ring division has avoidable expenses of $30,000 and unavoidable expenses of $20,000. With revenues of $90,000, should the ring division be eliminated?
A.Yes, revenue exceeds avoidable costs by $60,000.
B.No, revenue exceeds avoidable costs by $60,000.
C.No, revenue exceeds avoidable costs by $70,000.
D.Yes, revenue exceeds avoidable costs by $70,000.
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