Suppose Tasty Tart is considering discontinuing its fruit and nuts product line. Assume that during the past year, the fruit and nuts' product line income statement showed the following (click the icon to view the income s atement data 0 Click the icon for additional information. If the company decides to disoontinue the product line, what will happen to the company's operating income? Should Tasty Tart disoontinue the fruit and nuts product line? Begin by preparing a contribution margin income statement for the fruit and nuts' product line. (Use a minus sign or parentheses to enter a loss.) Sales revenue Less: Variable expenses Contribution margin Less: Fixed expenses Operating income (loss) $ 7,650,000 Data Table More Info Sales revenue Less: Cost of goods sold Gross profit Less: Operating expenses Operating income (loss) $ 7,650,000 6,250,000 1,400,000 1,500,000 (100,000) Fixed manufacturing overhead costs account for 40% of the cost of goods, while only 30% of the operating expenses are fixed. Since the fruit and nuts line is just one of the company's fruit operations, only $780,000 of direct fixed costs (the majority of which is advertising) wl l be eliminaled if the product line is disoontinued. The remainder of the fixed costs willsill be incumed by the company. Print Done Print Done