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Lantern Company has three product lines: D, E, and F. The following information is available: E Sales revenue Variable expenses D $82,000 $40,000 $42,000 $12,000
Lantern Company has three product lines: D, E, and F. The following information is available: E Sales revenue Variable expenses D $82,000 $40,000 $42,000 $12,000 $30,000 $42,000 $22,000 $20,000 $15,000 $5,000 $25,000 $14,000 $11,000 $17,000 $(6,000) Fixed expenses Operating income (loss) Lantern Company is thinking of discontinuing product line F because it is reporting an operating loss. All fixed expenses are unavoidable. Assuming Lantern Company discontinues product line F and does not replace it, what affect will this have on operating income? O A. Increase $11,000 O B. Increase $6,000 O C. Increase $40,000 OD. Decrease $11,000
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