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Dominion Ltd. is thinking of dropping one of its product lines, product line A. The following information is available: Product Line A Sales $18578 Variable
Dominion Ltd. is thinking of dropping one of its product lines, product line A. The following information is available:
|
| Product Line A |
| Sales | $18578 |
| Variable costs | 15846 |
| Fixed costs | 6662 |
| Operating income | $-3930 |
If Dominion Ltd. drops product line A, 66% of the fixed costs would be avoidable.
Assuming the company drops line A and does not replace it, the change in operating income will be
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