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Diamond Company has three product lines, A, B, and C. The following financial information is available: Item Product Line A Product Line B Sales 564,000

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Diamond Company has three product lines, A, B, and C. The following financial information is available: Item Product Line A Product Line B Sales 564,000 $130,000 Variable costs $38, 400 $ 69,000 Contribution margin $25,500 $ 61,000 Fixed costs: Avoidable $ 6,000 $ 17,500 Unavoidable $4,700 $ 13,000 Pre-tax operating income $14,900 $ 30,500 Product Line $29,000 $18, 125 $10,875 $ 8,100 $ 3,700 $ (-925) Diamond is thinking of dropping Product Line C because it is reporting an operating loss. Assuming the company drops Product Line C and does not replace it, pre-tex operating income for the firm will likely

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