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The condensed income statement for a Fletcher Inc. for the past year is as follows: Product F G H Total Sales $300,000 $210,000 $340,000 $850,000

The condensed income statement for a Fletcher Inc. for the past year is as follows:

Product

F

G

H

Total

Sales

$300,000

$210,000

$340,000

$850,000

Costs:

Variable costs

$180,000

$180,000

$220,000

$590,000

Fixed costs

50,000

50,000

40,000

140,000

Total costs

$230,000

$230,000

$260,000

$730,000

Income (loss)

$ 70,000

$ (20,000)

$ 80,000

$120,000

Management is considering the discontinuance of the manufacture and sale of Product G at the beginning of the current year. The discontinuance would have no effect on the total fixed costs and expenses or on the sales of Products F and H. What is the amount of change in net income for the current year that will result from the discontinuance of Product G?

$20,000 increase

$30,000 increase

$20,000 decrease

$30,000 decrease

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