Gata CoPlans to Discontinue a Department That Has a $48,000 Contribution

question 61

Multiple Choice

Gata Co.plans to discontinue a department that has a $48,000 contribution margin and $96,000 of fixed costs.Of these fixed costs,$42,000 cannot be avoided.What would be the effect of discontinuing the department on Gata's overall operating income?

• A) An increase of $6,000.
• B) A decrease of $6,000.
• C) An increase of $48,000.
• D) A decrease of $48,000.

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Definitions:

Annihilate

To destroy completely, leaving nothing remaining.

Anthropologists

Scientists who study human societies, cultures, and their development, often involving field research and comparative analysis.

Igbo Omu

A specific term likely referring to a concept or cultural element within the Igbo society of Nigeria, but without more context, its exact definition is unclear.