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BlossomIndustries manufactures light fixtures for home, retail, and industrial customers. The retail line has been showing losses for several years, and management is considering dropping

BlossomIndustries manufactures light fixtures for home, retail, and industrial customers. The retail line has been showing losses for several years, and management is considering dropping the line. Recent income statements have been very similar to the following information which was prepared for the most recent year:

Home

Retail

Industrial

Total

Sales

$552300

$322300

$832300

$1706900
Variable costs

359500

220000

683000

1262500
Contribution margin 192800

102300

149300

444400
Fixed costs

127300

132300

117300

376900
Operating income

$65500

$(30000)

$32000

$67500

Of the fixed costs, $321900 of it is common costs that have been allocated equally to each product line. What will total operating income be if Blossom drops the retail line?

a) $77300

b) $(9800)

c) $20200

d) $97500

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