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Bubblemanis has three product lines - A, B, and C. A B C Total Sales $10,000 $9,000 $12,000 $31,000 Variable costs 4,500 7,000 6,000 17,500
Bubblemanis has three product lines - A, B, and C.
A | B | C | Total | |
Sales | $10,000 | $9,000 | $12,000 | $31,000 |
Variable costs | 4,500 | 7,000 | 6,000 | 17,500 |
Contribution margin | 5,500 | 2,000 | 6,000 | 13,500 |
Fixed costs | 3,500 | 6,000 | 3,000 | 12,500 |
Net income | 2,000 | (4,000) | 3,000 | 1,000 |
Product line B appears unprofitable, and management is considering discontinuing the line. How would the discontinuation of Product line B affect net income?
Select one:
a. increase by $2,000
b. decrease by $2,000
c. decrease by $4,000
d. increase by $4,000
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