Claris Corporation (a multi-product company) produces and sells 7,000 units of Product X each year. Each unit
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Claris Corporation (a multi-product company) produces and sells 7,000 units of Product X each year. Each unit of Product X sells for $12 and has a contribution margin of $4. If Product X is discontinued, $19,000 of the $32,000 in fixed costs charged to Product X could be eliminated. If Product X is discontinued, the company's overall operating income would:
a) Decrease by $4,000 per year.
b) Increase by $4,000 per year.
c) Decrease by $9,000 per year.
d) Increase by $9,000 per year.
Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-0078025655
7th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor-Yi Tsay, Philip Old
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