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Q1) Cameron Company has recorded information given below about results of its operations for first quarter:

  Total Company Southern Division Northern Division
Sales revenues $200,000 $ 80,000 $120,000
Variable cost of sales $ 60,000 $ 30,000 $30,000
Fixed costs:
     Common $100,000 25,000 75,000
     Traceable $ 50,000 20,000 30,000

Which alternative would most probably improve company's financial performance, overall?

a) shut down Southern Division

b) shut down Northern Division

c) reduce common fixed costs

d) reduce traceable fixed costs

Accounting Basics, Accounting

  • Category:- Accounting Basics
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