Northern Company Has Three Departments, Wires, Ropes and Cables

Multiple Choice

Northern Company has three departments, Wires, Ropes and Cables. At the end of the accounting period the following information is available:

Northern Company is considering eliminating the Wires department. What will be the change in Northern Company's profit if the Wires department is eliminated? Assume that all indirect expenses are unavoidable and that all other circumstances are held constant.

A) $1 000 fall
B) $4 000 fall
C) $3 000 fall
D) $3 000 increase