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Product A Product B Product C Sales $60,000 $90,000 $24,000 Variable costs 36,000 48,000 15,000 Fixed costs: Avoidable 9,000 18.000 6,000 Unavoidable 6,000 9,000 5.400
Product A Product B Product C Sales $60,000 $90,000 $24,000 Variable costs 36,000 48,000 15,000 Fixed costs: Avoidable 9,000 18.000 6,000 Unavoidable 6,000 9,000 5.400 Operating income $9.000 $15,000 $(2,400) Assuming Product C is discontinued, and the space formerly used to produce Product is rented for $12.000 per year, operating income for the entire company will: increase by $12.000 increase by $9.000
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