Johnson Corp produces 3 products: Product A, Product B, and Product C. A segmented income statement for the past year is provided below: Product A Product B Product C Total Sales 18,000 52,000 19,000 89,000 Variable Expenses 12,000 29,000 10,000 51,000 Contribution Margin 6,000 23,000 9,000 38,000 Direct Fixed Expenses: Supervisor Salaries 4,000 7,000 6,000 17,000 Depreciation 1,000 9,000 7,000 17,000 Segment Margin 1,000 7,000 (4,000) 4,000 The contribution margin for Product C is $9,000. The relevant fixed costs include $6,000 in supervision salaries. Depreciation and supervisor salaries are dedicated to the product lines. If a product is dropped, the company is able to eliminate the supervisor salaries for that product. None of the equipment being depreciated can be sold. Question 21 (1 point) Saved If product C is dropped operating income will: Stay the same Increase Question 22 (3 points) Saved What will be the change in operating income if Product C is dropped? Enter your answer as a positive number. 9000 A/ Question 23 (1 point) Saved Based on the change in operating income alone, should product C be dropped? (yes or no) Yes No Question 24 (1 point) Saved Now assume that product C is dropped and sales of Product A will increase by 50% with no change in the relevant direct fixed expenses. Operating income for the company will: Increase Stay the same Increase Stay the same Decrease Question 25 (3 points) Saved Assume that Product C is dropped and sales of Product A increase by 50%. What is the total increase or decrease in operating income. Enter your answer as a positive number. 19000 A/