Wasiko Corporation has two departments, Kids and Adults. The company's most recent monthly contribution format income statement follows: 1 1:24:52 Sales Variable expenses Contribution Margin Fred Expenses Net operating income foss) Department Total Kids Adults $4,200,000 $3,000,000 $1,200.000 2.000.000 1.500.000 500.000 2.200.000 1.500.000 700.000 2.200.000 1.300.000 900.000 0 200,000 (200.000 A study indicates that $250,000 of the fived expenses being charged to the Adults Department are sunk costs or allocated costs that will continue even if the Adults Department is dropped. In addition, the elimination of the Adults Department will result in a 20 decrease in the sales of the kids Department of the Adults Department is dropped, what will be the effect on the net operating income of the company as a whole? Multiple Choice Decrease by $370,000 O Decrease by $350,000 Increase by $370,000 Net operating income foss) 0 200,000 (200,000) A study indicates that $250,000 of the fixed expenses being charged to the Adults Department are sunk costs or allocated costs that will continue even if the Adults Department dropped. In addition, the elimination of the Adults Department will result in a 20% decrease in the sales of the Kids Department. If the Adults Department is dropped, what will be effect on the net operating income of the company as a whole? Multiple Choice Decrease by $370,000 Decrease by $350,000 O Increase by $370,000 Decrease by $330,000