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The income statement for Wake Me Up Appliances is divided by its two product lines, Toasters and Coffee Machine, as follows: Sales revenue Variable
The income statement for Wake Me Up Appliances is divided by its two product lines, Toasters and Coffee Machine, as follows: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Toaster $640,000 $470,000 $170,000 $75,000 $95,000 Coffee Machine Total $255,000 $895,000 $210,000 $680,000 $45,000 $215,000 $75,000 $150,000 $(30,000) $65,000 If fixed costs remain unchanged and Wake Me Up Appliances discontinues the Coffee Machine line, how will operating income change? OA. Will increase by $45,000 OB. Will increase by $150,000 OC. Will decrease by $45,000 OD. Will decrease by $150,000
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