The High School Musical Company has two divisions - Troy and Gabriella. In the previous year, Troy generated sales revenue of $300,000 and reported a variable cost percentage of 20%. Troy's total traceable costs equaled $70,000. Gabriella generated a segment margin of $40,000. Common fixed costs totaled $100,000 and were evenly allocated to the two divisions. Management is considering the elimination of the Gabriella division since it has shown an operating loss for the past several years. If Gabriella is dropped, the company would open a new division in its place. The new division would generate $180,000 in sales revenue and have a contribution margin percentage of 60%. The new division's segment margin would equal $60,000. In addition, it is projected that opening the new division would decrease Troy's sales volume by 2%. Which of the following statements is correct with regard to the above information? (each statement is independent) O A. If Gabriella is dropped and replaced with the new division, the company's new operating income will be $185,400. OB. Troy's contribution margin percentage will decrease by 2% if Gabriella is dropped and replaced with the new division O C. The company's common fixed costs would decrease by $50,000 if Gabriella is dropped. OD. Total traceable costs for the new division is $72,000. E. None of the above statements are correct