On January 2, the management accountant for Giada's Book Store prepared the following projected income statement for the current year:

Cookbook Travel Book Classics Total Sales $60,000 $100,000 $40,000 $200,000 Cost of goods sold 36,000 65,000 20,000 121,000 Contribution margin 24,000 35,000 20,000 79,000 Order and delivery processing 18,000 21,000 8,000 47,000 Rent (per sq. foot used) 2,000 1,000 3,000 6,000 Allocated corporate costs 7,000 7,000 7,000 21,000 Operating Income $ (3,000) $ 6,000 $ 2,000 $ 5,000 Assume that sales and costs are an accurate prediction for this year. If the Travel Book line is discontinued immediately, the space rented and used for travel books will be used by the other book lines. If we drop the Travel Book line, overall firm operating income for this year will decrease by:

Question 11 options:

a)

$6,000

b)

$14,000

c)

$13,000

d)

$35,000