Shine Bright Company has three product

lines long dash D,

E, and F. The following information is available:

	D	E	F
Sales	$60,000	$38,000	$26,000
Variable costs	36,000	18,000	12,000
Contribution margin	24,000	20,000	14,000
Fixed expenses	12,000	15,000	16,000
Operating income (loss)	$12,000	$5,000	$(2,000)

Shine Bright Company is thinking of dropping product line F because it is reporting an operating loss. Assuming fixed costs are unavoidable, if Shine Bright Company drops product line F and rents the space formerly used to produce product F for $17,000 per year, what effect will this have on operating income?

A. Operating income will increase $15,000.

B.Operating income will decrease $3,000.

C.Operating income will decrease $14,000.

D.Operating income will increase $3,000.