Answer
Measuring the absolute profitability of an existing segment is conceptually straightforward: compare the revenues that would be lost from dropping the segment to the costs that would be avoided.
Work Step by Step
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Managerial Accounting (15th Edition)
by Garrison, Ray; Noreen, Eric, Brewer, Peter
Published by
McGraw-Hill Education
ISBN 10:
007802563X
ISBN 13:
978-0-07802-563-1
Appendix B - Profitability Analysis - Questions - Page 735: B-4
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