Macaulay Roller Skates Company Has Three Product Lines-D,E,and F

question 118

Multiple Choice

Macaulay Roller Skates Company has three product lines-D,E,and F.The following information is available:
- The company is thinking of dropping product line F because it is reporting an operating loss.Assuming fixed costs are unavoidable,if Macaulay drops product line F,and rents the space formerly used to produce product F for $17,000 per year,total income will be ________.

• A)$10,000
• B)$12,000
• C)$20,000
• D)$25,000

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