Question: 4) Protector, Inc. has two product lines batting helmets and football helmets. The income statement data for the most recent year is as follows: Sales
4) Protector, Inc. has two product lines batting helmets and football helmets. The income statement data for the most recent year is as follows: Sales revenue Variable costs Contribution margin Fixed costs Operating income (loss) Total $840,000 (480.000) $360,000 (170.000) $190,000 Batting Helmets $500,000 (200,000) $300,000 (80,000 $220.000 Football Helmets $340,000 (280,000) $60,000 (90.000 S(30.000 Assuming the football helmets line is dropped, total fixed costs remain unchanged, and the space formerly used to produce the line is rented for $100,000 per year, how will operating income be affected? A) Operating income will increase by $40,000. B) Operating income will increase by $60,000. C) Operating income will decrease by $60,000. D) Operating income will decrease by $40,000
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