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Mason Transport has four divisions. A recent income statement for its West division follows: ...

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Accounting

Mason Transport has four divisions. A recent income statement for its West division follows:

Revenue 250,000

Salaries for drivers (175,000)

fuel expenses ( 25,000)

Insurance for division facility ( 35,000)

Division-level facility sustaining costs (20,000)

Company-wide facility sustaining costs (65,000)

Should the company eliminate the West division?

Which are the relevant costs to the decision?

What if West is able to increase revenue to $270,000 by raising prices?

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