Author: Anonymous

Games Inc. has two product lines, online games and in-store games. They are considering dropping the in-store games divisions so they can focus on online games.  Below is a segmented income statement for the in-store games division. Sales  $      121,000 Variable expenses             90,600 Contribution margin             30,400 Administrative expenses             18,990 General expenses             21,600 Net income  $      (10,190) Sales and variable expenses are traceable directly to the in-store games segment.  If the in-store division were dropped, what would be the effect on the company related to sales?

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