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Question Potter, Inc. has two product lines-quidditch helmets and football helmets. The income statement data for the most recent year is as follows: Total
Question Potter, Inc. has two product lines-quidditch helmets and football helmets. The income statement data for the most recent year is as follows: Total Quidditch Helmets Football Helmets Sales revenue $1,020,000 $700,000 $320,000 Variable costs (500.000) (200.000) (300.000 Contribution margin $520,000 $500,000 $20,000 Fixed costs (170.000) (80.000) (20.000) Operating income Kloss) $350,000 $420,000 $70.000 Assuming the football helmets line is dropped, total fixed costs remain unchanged, and the space formerly used to produce the line is rented for $100,000 per year, how will operating income be affected? O Operating income will decrease by $20,000. Operating income will increase by $20,000. O Operating income will decrease by $80,000. O Operating income will increase by $80,000.
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