Bridge Company makes special equipment used in cell towers. Each unit sells for $410. Bridge uses just-in-time inventory procedures, it produces and sells 12,500 units per year. It has provided the following income statement data: Traditional Format Contribution Margin Format Sales revenue $5,125,000 Sales revenue $5,125,000 Cost of goods sold 3.000.000 Variable costs: Gross profit 2,125,000 Manufacturing 1,000,000 Selling & admin. expenses 725.000 Selling & admin 500,000 Contribution margin 3,625,000 Fixed costs: Manufacturing 2.000.000 Selling & admin 225,000 Operating income $1.400.000 Operating income $1,400.000 A foreign company has offered to buy 100 units for a reduced sales price of $200 per unit. The marketing manager says the sale will have no negative impact the company's regular sales. The sales manager says that this sale will not require any additional selling and administrative costs, as it is a one-time deal. The production manager reports that there is plenty of excess capacity to accommodate the deal without requiring any additional fixed costs. If Bridge accepts the deal, how will this impact operating income? (Round any intermediate calculations to the nearest cent, and your final answer to the nearest dollar.) Select one: A. Operating income will increase by $20,000. B. Operating income will increase by $12,000. C. Operating income will decrease by $12,000 D. Operating income will increase by $22,000. E. Operating income will increase by $120,000 0 F. Operating income will increase by $40,000 G. None of the above. In deciding whether to drop its electronics product line, a company's manager should ignore Select one: O A. the revenues it would lose from dropping the product line B. the amount of avoidable fixed costs C. the effect of dropping the electronics product line on the sales of its other products D. the variable and fixed costs it could save by dropping the product line E. the depreciation on the factory building O Michael's Hats, Inc. has two product lines"batting helmets and football helmets. The income statement data for the most recent year is as follows: Total Batting Helmets Football Helmets Sales revenue $900,000 $500,000 $400,000 Variable costs (490,000) (200,000) (290.000) Contribution margin $410,000 $300,000 $110,000 Fixed costs (230.000) (80,000) (150,000) Operating income (loss) $180.000 $220,000 $(40.000) If $90,000 of fixed costs will be eliminated by dropping the football helmets line, how will dropping football helmets affect operating income of the company? Select one O A. Operating income will decrease by $150,000 B. Operating income will decrease by $30,000 0 0 C. Operating income will increase by $120,000 O O D. Operating income will increase by $90,000. E. Operating income will decrease by $40,000. F. Operating income will decrease by $20,000 G. None of the above