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A Segment Has the Following Data  Sales $700,000 Variable expenses 300,000 Fixed expenses 550,000\begin{array}{lr}\text { Sales } & \$ 700,000 \\\text { Variable expenses } & 300,000 \\\text { Fixed expenses } & 550,000\end{array}

Question 150

Multiple Choice

A segment has the following data:  Sales $700,000 Variable expenses 300,000 Fixed expenses 550,000\begin{array}{lr}\text { Sales } & \$ 700,000 \\\text { Variable expenses } & 300,000 \\\text { Fixed expenses } & 550,000\end{array} What will be the incremental effect on net income if this segment is eliminated assuming the fixed expenses will be allocated to profitable segments?


A) $400000 increase
B) $400000 decrease
C) $5000 decrease
D) Cannot be determined from the data provided.

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