A Manager at the Marina Concepts Store Sells Three Levels

question 80

Multiple Choice

A manager at the Marina Concepts Store sells three levels of boat heaters,low,medium,and high,to house their winter boats.The managerial accountant reported the following information:

The high-level heater is operating at a loss.If the manager discontinued the high-level heater,what is the increase or decrease in operating income? What is the increase or decrease in operating income if the manager discontinued the heater and rented out the space used to store the heater for $11,000 per year?

• A)$800 increase;$8,500 increase
• B)$900 decrease;$9,200 decrease
• C)$1,000 increase;$9,300 increase
• D)$3,400 decrease;$7,600 increase
• E)$1,600 increase;$9,600 increase