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This Question: 1 pt 439 of 40 (17 complete) This Test: 40 pts pos Castillo Corporation has provided you with the following budgeted income statement
This Question: 1 pt 439 of 40 (17 complete) This Test: 40 pts pos Castillo Corporation has provided you with the following budgeted income statement for one of its products Sales revenue Variable costs Contribution margin Fixed costs Operating loss S700,000 (430,000) $270,000 (320,000) s(50,000) Castillo has just encountered environmental problems with the product and will be forced to drop the product line altogether Castillo will be able to eliminate 60% of the fixed costs What will be the impact on operating income of the company? O A. Operating income will decrease by $78,000 O B. Operating income will increase by $78,000 c. operating income will increase by $192,000 O D. Operating income will decrease by $192,000
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