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Boots Plus has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Sales revenue Variable expenses Contribution

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Boots Plus has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Total $520,000 355,000 165,000 79,000 $86,000 Hiking $380,000 235,000 145,000 39,500 $105,500 Fashion $140,000 120,000 20,000 39,500 $(19,500) If $25,000 of fixed costs will be eliminated by discontinuing the Fashion line, how will operating income be affected? A. Decrease $48,500 B. Increase $95,000 C. Increase $181,000 D. Increase $5,000

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