Question 45

Manor Company plans to discontinue a department that has a contribution margin of $24,000 and $48,000 in fixed costs. Of the fixed costs, $21,000 cannot be avoided. What would be the effect of discontinuing the department on Manor's overall operating income?

Question 45 options:

A)

A decrease of $3,000.

B)

An increase of $3,000.

C)

An increase of $24,000.

D)

A decrease of $24,000.