Protector,Inc

question 50

Multiple Choice

Protector,Inc.has two product lines-batting helmets and football helmets.The income statement data for the most recent year is as follows:

Assuming the football helmets line is dropped,total fixed costs remain unchanged,and the space formerly used to produce the line is rented for $100,000 per year,how will operating income be affected?

• A)Operating income will increase by $60,000.
• B)Operating income will increase by $40,000.
• C)Operating income will decrease by $40,000.
• D)Operating income will decrease by $60,000.

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