Fabio Corporation Is Considering Eliminating a Department That Has a Contribution

question 160

Multiple Choice

Fabio Corporation is considering eliminating a department that has a contribution margin of $30,000 and $60,000 in fixed costs. Of the fixed costs, $15,000 cannot be avoided. The effect of eliminating this department on Fabio's overall net operating income would be:

• A)a decrease of $30,000.
• B)an increase of $30,000.
• C)a decrease of $15,000.
• D)an increase of $15,000.

---

Definitions:

Good Health

A condition of total well-being encompassing physical, mental, and social aspects, rather than just the lack of sickness or weakness.

Informed Consent

The process by which a fully informed patient can participate in choices about their health care. It originates from the legal and ethical right the patient has to direct what happens to their body.

Ethical Codes

Established guidelines that outline the standards of conduct expected in certain professions or organizations.

Research Study

A scientific project that systematically investigates and analyzes materials, sources, and other data to establish facts and reach new conclusions.