Use the Information Below to Answer the Following Question(s)

question 158

Multiple Choice

Use the information below to answer the following question(s) :
The income statement for Champion Parts is divided by its two product lines, Part L2 and Part C6, as follows:

-If fixed costs remain unchanged and Champion Parts drops the Part C6 line, how will operating income change?

• A) Will decrease by $65,000
• B) Will increase by $65,000
• C) Will decrease by $10,000
• D) Will increase by $10,000

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