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

question 4

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 Champion Parts can eliminate fixed costs of $40,000 by dropping the Part C6 line, then dropping it should result in which of the following?

• A) Increase in total operating income of $25,000
• B) Increase in total operating income of $65,000
• C) Decrease in total operating income of $65,000
• D) Decrease in total operating income of $25,000

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Definitions:

Resource-Based View

A strategic management perspective that considers a firm's internal capabilities and resources as the primary determinants of its competitive advantage.

HR Practices

Human Resources (HR) practices encompass the strategies, methods, and policies used to manage and support the workforce in an organization.

Effective HR Practices

Human resources strategies and methods that significantly improve organizational performance and employee satisfaction.

Better Use

The optimization of resources, assets, or opportunities to achieve improved outcomes or greater efficiency.