just question #3

1. A company produces two kinds of hummers one with longer handles and cos with shortet handles The longer hammer wes better materials and has a better design for back support. During the past year 200.000 shortet hammers and 50,000 longer hammers were produced and told Foxed costs amount to $500,000. If the shorter hammers were dropped from production, $180,000 of the fixed costs would be avoided. If the longer hammers were dropped, 590,000 of the fixed costs would be avoided. Shorter Longer Variable expenses/unit $10 586 Sales price $44 $90 The contribution margin of the shorter and longer lammers, respectively is 2 $200,000/$800,000 c$8000,000/54,300,000 b. 5620,000/110.000 d $800,000/$200,000 2. If the company stops producing the longer hammer, what will be the effect on the company's income? a Decrease by $200,000 e Decrease by $800,000 b. Decrease by $110,000 d Decrease by 5620,000 3. If the company stops producing the shorter hammer, what will be the effect on the company's income? a Decrease by $200,000 Decrease by $800,000 5. Decrease by $110.000 d. Decrease by $620,000