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Tremaine Inc. has three product lines: A, B, and C. Total $55,000 $90,000 $95,000 $240,000 37,000 40,000 45,000 122,000 18,000 50,000 50,000 118,000 Sales Variable
Tremaine Inc. has three product lines: A, B, and C. Total $55,000 $90,000 $95,000 $240,000 37,000 40,000 45,000 122,000 18,000 50,000 50,000 118,000 Sales Variable costs Contribution margin Fixed costs Net income 23,000 20,000 30,000 73,000 $(5,000) $30,000 $20,000 $45,000 Management is considering dropping product line A. If it is discontinued, $14,00o of its fixed costs can be avoided. The discontinuation of product line A would: O a. decrease net income by $15,000. b. decrease net income by $4,000. O c. increase net income by $21,000. O d. increase net income by $4,000
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