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Pottery Unlimited has two product lines: cups and pitchers. Income statement data for the most recent year follow. Sales revenue Variable expenses Contribution margin
Pottery Unlimited has two product lines: cups and pitchers. Income statement data for the most recent year follow. Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Total $460,000 355,000 Cups $310,000 111 105,000 76,000 $29,000 Pitchers $150,000 235,000 75,000 120,000 30,000 38.000 38,000 $37,000 $(8,000) If $20,000 of Pottery Unlimited's fixed costs will be eliminated by dropping the Pitcher line, how will operating income be affected? OA. Increase $2,000 OB. Increase $12,000 OC. Decrease $20,000 OD. Decrease $10,000
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