Ivanhoe Michael, the controller of Inca Industries, has prepared an analysis to help management determine whether one of Incas departments should be eliminated. The departments contribution margin is $48000. The fixed expenses charged to the department total $82000. Of the fixed expenses, Michael estimates that $40000 of those expenses would be eliminated if the department were discontinued. Based on Michaels analysis, if the department is eliminated, Incas overall operating income would

decrease by $6000 per year.

decrease by $8000 per year.

increase by $8000 per year.

decrease by $34000 per year.