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Question 5 Company X is considering whether to discontinue a division. The division generates a total contribution margin of $68,000 per year. Of the
Question 5 Company X is considering whether to discontinue a division. The division generates a total contribution margin of $68,000 per year. Of the $60,000 of fixed manufacturing overhead allocated to this division, 23,000 is unavoidable. Assuming Company X eliminates this division, the effect on the company's operating income would be a(n) A. Increase of $45,000. B. Increase of $31,000. C. Decrease of $45,000. D. Decrease of $31,000.
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