$90,000 Tremaine Inc. has three product lines: A, B, and C. A B Sales $50,000 $85.000 Variable costs 30,000 30.000 Contribution margin 20,000 55,000 Fixed costs 23,000 25.000 Net income S (3.000) $30.000 44,000 Total $225,000 104.000 121,000 66,000 $ 55.000 46,000 18,000 $28.000 38. Management is considering dropping product line A. If it is discontinued, its fixed costs are all common fixed costs. The discontinuation of product line A would: + a. Increase net income by $2,600 b. Decrease net income by $20.000. c. Increase net income by $6,500. d. Decrease net income by $2.000. e. Increase net income by $3.000. 39. Management is considering dropping product line A. If it is discontinued. $18,000 of its fixed costs are DTFC. The discontinuation of product line A would: a. Increase net income by $2.600 b. Decrease net income by $20.000. c. Increase net income by $6,500. d. Decrease net income by $2,000. e. Increase net income by $3,000. 40. Management is considering dropping product line A. If it is discontinued. (1) $18,000 of its fixed costs are DTFC and (2) the sales of Product C would increase by 10%. The discontinuation of product line A would: a. Increase net income by $2.600 b. Decrease net income by $20,000. c. Increase net income by $6,500. d. Decrease net income by $2.000. e. Increase net income by $3.000. 41. Management is considering dropping product line A. If it is discontinued. (1) $18,000 of its fixed costs are DTFC and (2) the selling price of Product B would increase by 10%. The discontinuation of product line A would: a. Increase net income by $2.600 b. Decrease net income by $20,000. c. Increase net income by $6,500. d. Decrease net income by $2,000. e. Increase net income by $3.000