Questions 13

X Meme Common Fixed Costs 15,000 Operating Income (5,000) Management is considering dropping Product line A because it is unprofitable. Assuming the prior year's results are typical, what will be the change in operating income? Have no effect Increase by $5,000 Decrease by $15,000 Decrease by $10,000 Previous Page Next Page Page 13 of 20 Submit Quiz 0 of 20 questions savedX Meme Question 13 (5 points) Bea Co. income statement from last year for one of its products - Product A - is presented below. Product line fixed costs can be avoided if the product line is discontinued. Common fixed costs are allocated based on revenues and can be avoided only if Bea Co. goes out of business entirely. The amounts indicated are for an entire year of operations. Product A Revenues $100,000 Variable Costs 40,000 Contribution Margin 60,000 Product Line Fixed Costs 50,000 Common Fixed Costs 15.000 Operating Income (5.000)