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Faros Hats, Etc. has two product lines?baseball helmets and football helmets. Income statement data for the most recent year follow: Assuming fixed costs remain unchanged,

Faros Hats, Etc. has two product lines?baseball helmets and football helmets. Income statement data for the most recent year follow:

Assuming fixed costs remain unchanged, and that there

would be no adverse effect on other sales. What will be the effect of dropping Football Helmets line on the operating income of the company?

Total Sales revenue $850,000 Variable expenses (530,000) Contribution margin $320,000 Fixed expenses (180,000) Operating income (loss) $140,000 Baseball Helmets Football Helmets $500,000 $350,000 (250,000) $250,000 (90,000) $160.000 (280,000) $70,000 (90,000) $(20,000)

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