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Sole Sisters Company has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Sales revenue Variable expenses
Sole Sisters Company has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Total $480,000 357,000 123,000 76,000 $47,000 Hiking $340,000 235,000 105,000 38,000 $67,000 Fashion $140,000 122,000 18.000 38,000 $(20,000) Assuming fixed costs remain unchanged, how would discontinuing the Fashion line affect operating income? O A. Increase in total operating income of $29,000 O B. Decrease in total operating income of $18,000 O C. Decrease in total operating income of $140,000 OD. Increase in total operating income of $123,000
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