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27.Management is considering dropping product line C. If it is discontinued, (1) all of its fixed costs are Common and cannot be avoided and (2) the selling price of Product A would increase by 45%. The discontinuation of product line C would:

A. decrease net income by $3,500.

B. increase net income by $1,000.

C. decrease net income by $500.

D.increase net income by $3,500

Laurel Inc. has three product lines: A, B, and C. A B C Total Sales $20,000 $35,000 $22,000 $T?,000 Variable costs M M M w Contribution margin 12,000 25,000 8,000 45,000 Fixed costs 4 000 l l 000 w 24 000 Net income w $14,000 g 1,000) $21,000