The results of the operating activities of Kobe Company for the current year are as follows:Based on these results, Kobe is considering discontinuing department C and establishing a new department D. The estimated revenues and expenses of the new department are as follows: Dept. DNet sales………..$480,000Cost of goods sold………270,000Direct operating expenses….185,000In addition, the proposed change will cause total indirect operating expenses to increase by $22,000.REQUIREDDetermine whether Kobe should discontinue department C and establish departmentD.
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The results of the operating activities of Kobe Company for



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