Head Bucket,Inc Assuming the Football Helmet Line Is Dropped,total Fixed Costs Remain

question 72

Multiple Choice

Head Bucket,Inc.has two product lines-batting helmets and football helmets.The income statement data for the most recent year is as follows: $\begin{array}{|l|r|r|r|} \hline& \text { Total } & \text { Batting Helmets } & \text { Football Helmets } \\\hline \text { Sales revenue } & \$ 820,000 & \$ 500,000 & \$ 320,000 \\\hline \text { Variable costs } & (430,000 & (150,000 & (280,000) \\\hline \text { Contribution margin } & \$ 390,000 & \$ 350,000 & \$ 40,000 \\\hline \text { Fixed costs } & (160,000 & \$(70,000 & (90,000) \\\hline \text { Operating income (loss) } & \$ 230,000 & \$ 280,000 & \$(50,000) \\\hline\end{array}$ Assuming the football helmet line is dropped,total fixed costs remain unchanged,and the space formerly used to produce the football helmet line is used to double the production of batting helmets,operating income will be ________.

• A) $350,000
• B) $160,000
• C) $540,000
• D) $280,000

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Registered Retirement Savings Plan, a Canadian investment account for holding savings and investment assets, aimed at providing retirement income.

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