The Operations of Balance Corporation Are Divided into the Kaplan

Essay

The operations of Balance Corporation are divided into the Kaplan Division and the Norton Division.Projections for the next year are as follows:
$$\begin{array} { | l | r | r | r | } \hline & \begin{array} { r } \text { Kaplan } \\\text { Division }\end{array} & \begin{array} { r } \text { Norton } \\\text { Division }\end{array} & \text { Total } \\\hline \text { Sales } & \$ 1,200,000 & \$ 600,000 & \$ 1,800,000 \\\hline \text { Variable costs } & 480,000 & 360,000 & 840,000 \\\hline \text { Contribution margin } & \$ 720,000 & \$ 240,000 & \$ 960,000 \\\hline \text { Direct fixed costs } & 160,000 & 90,000 & 250,000 \\\hline \text { Segment margin } & \$ 560,000 & \$ 150,000 & \$ 710,000 \\\hline \begin{array} { l } \text { Allocated common } \\\text { costs }\end{array} & 360,000 & 180,000 & 540,000 \\\hline \begin{array} { l } \text { Operating income } \\\text { (loss) }\end{array} & \$ 200,000 & \$ 30,000 ) & \$ 170,000 \\\hline\end{array}$$

Required:
a.Operating income for Balance Corporation as a whole if the Norton Division were dropped would be
b.If the Norton Division were dropped,Kaplan Division's sales would increase by 45%.If this happened,the operating income for Balance Corporation as a whole would be: