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Suresh Co. expects its five departments to yield the following income for next year.

	Dept. M				Dept. N					Dept. O				Dept. P					Dept. T					Total
Sales		$	73,000			$	39,000				$	66,000			$	48,000				$	34,000			$	260,000
Expenses
Avoidable			12,800				40,000					24,200				17,000					43,200			$	137,200
Unavoidable			54,200				16,200					4,800				37,000					14,000			$	126,200
Total expenses			67,000				56,200					29,000				54,000					57,200				263,400
Net income (loss)		$	6,000			$	(17,200	)			$	37,000			$	(6,000	)			$	(23,200	)		$	(3,400	)

Recompute and prepare the departmental income statements (including a combined total column) for the company under each of the following separate scenarios.

Exercise 23-10 Part 1

(1) Management eliminates departments with expected net losses.

(2) Management eliminates departments with sales dollars that are less than avoidable expenses.

	DEPARTMENTS WITH EXPECTED NET LOSSES ELIMINATED Dept. M Dept. N Dept. O Dept. P Dept. T Total Sales Expenses: Avoidable Unavoidable Total expenses Net income (loss)

	DEPARTMENTS WITH LESS SALES THAN AVOIDABLE EXPENSES ELIMINATED Dept. M Dept. N Dept. O Dept. P Dept. T Total Sales $0 Expenses: Avoidable 0 Unavoidable 0 Total expenses Net income (loss) $0 $0 $0 $0 $0 $0

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