Shine Bright Company Has Three Product Lines-D, E, and F

question 65

Multiple Choice

Shine Bright Company has three product lines-D, E, and F. The following information is available: Shine Bright Company is thinking of dropping product line F because it is reporting an operating loss. Assuming fixed costs are unavoidable, if Shine Bright Company drops product line F and rents the space formerly used to produce product F for $17,000 per year, what effect will this have on operating income?

• A)Operating income will increase $3,000.
• B)Operating income will increase $15,000.
• C)Operating income will decrease $14,000.
• D)Operating income will decrease $3,000.

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Definitions:

Marketing Department

A division within a company responsible for developing strategies and tactics to promote, sell, and distribute its products or services.

Environmental Forces

External factors such as social, economic, technological, and political conditions that affect businesses and consumers.

Marketing Occur

The processes or activities undertaken by individuals or organizations to promote, sell, and distribute a product or service.

Desire

A strong feeling of wanting to have something or wishing for something to happen.