Betty's Fashions operates retail stores in both downtown and suburban locations. The company has two responsibility...

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Bettys Fashions operates retail stores in both downtown and suburban locations. The company has two responsibility centers: Check a. Using the worksheet below, determine which revenues and costs are probably differential for the decision to disconti

Complete this question by entering your answers in the tabs below. Required A Required B What will be the effect on Bettys p

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Answer 1

Answer #1

A)

BETTYs Fashions City Division
Divisional income Statement
Differential Revenues and costs
For the year ending January 31
Sales revenue	6,000,000.00	Differential
Costs
Advertising-City Divisoon	192000	Differential
Cost of Goods Sold	3850000	Differential
Divisional administrative Salaries	307000	Differential
Selling Costs	597000	Differential
Rent	752000	Differential
Share of Corporate Administration	0	Not differential
Total Costs	5698000
Net differential gain before income tax expense	302,000.00
Tax expense at 40% Rate	120,800.00	Differential
Net Differential gain from store	181,200.00

B)Betty Profit will decrease by 181,200

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Answer 2

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Betty's Fashions operates retail stores in both downtown and suburban locations. The company has two responsibility...

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