Question - Niklos Boot Co. sells men's, women's, and children's boots. For each type of boot sold, it operates a separate department that has its own manager. The manager of the men's department has a sales staff of nine employees, the manager of the women's department has six employees, and the manager of the children's departments has three employees. All departments are housed in a single store. In recent years, the children's department has operated at a net loss and is expected to continue to do so. Last year's income statements follow.
Required -
1. Calculate the contribution to profit of the children's department.
2. Should the children's department be eliminated?
3. Calculate the net income for the company as the whole with the children's department.
4. Prepare the income statement for the company as the whole without the children's department.