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The Income Statement for Germain Appliances Is Divided by Its

Question 60

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The income statement for Germain Appliances is divided by its two product lines,Toasters and Microwaves,as follows:
The income statement for Germain Appliances is divided by its two product lines,Toasters and Microwaves,as follows: If Germain Appliances can eliminate fixed costs of $32,000 and increase the sale of Toasters by 6,000 units at a selling price of $30 per unit and a contribution margin of $8 per unit,then discontinuing the Microwaves should result in which of the following? A) Increase in total operating income of $35,000 B) Increase in total operating income of $3,000 C) Decrease in total operating income of $35,000 D) Decrease in total operating income of $3,000
If Germain Appliances can eliminate fixed costs of $32,000 and increase the sale of Toasters by 6,000 units at a selling price of $30 per unit and a contribution margin of $8 per unit,then discontinuing the Microwaves should result in which of the following?


A) Increase in total operating income of $35,000
B) Increase in total operating income of $3,000
C) Decrease in total operating income of $35,000
D) Decrease in total operating income of $3,000

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