t30

The following information relates to next year's projected operating results of the Children's Division of Grunge Clothing Corporation:

Contribution margin	$	200,000
Fixed expenses		500,000
Net operating loss	$	(300,000	)

If the Children's Division is eliminated, $170,000 of the above fixed expenses could be avoided. The annual financial advantage (disadvantage) for the company of eliminating this division should be:

Multiple Choice

• ($300,000)

• $30,000

• ($30,000)

• $300,000