Carns Company is considering eliminating its Small Tools Division, which reported a loss for the prior year of $125,000 as shown below. Sales Segment Income (Loss) $ 1,350,000 Variable costs Contribution margin 1,215,000 135,000 260,000 $ (125,000) Fixed costs Income (loss) If the Small Tools Division is dropped, all of its variable costs are avoidable, and $104,000 of its fixed costs are avoidable. The impact on Carns's Income from eliminating the Small Tools Division would be: Mukicle Cheied $64,600 $31,000 $260,000 DE $31,000 in $104,000