Department Z Has a Gross Profit of $30 000, Direct

Multiple Choice

Department Z has a gross profit of $30 000, direct departmental expenses of $12 000 and allocated expenses of $21 000 giving it a net loss of $3000. What would be the effect on the total organisation's profit if Department Z were closed?

A) Profits would increase by $3000
B) Profits would decrease by $18 000
C) Profits would decrease $9000
D) Profits would increase by $30 000