Question: Jim Bean Company has three product lines: D, E, and F. The following information is available: Sales revenue Variable expenses Contribution margin Fixed expenses Operating
Jim Bean Company has three product lines: D, E, and F. The following information is available: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) D $ 80,000 $ 40.000 $ 40,000 $ 12,000 $28.000 E $42,000 $21,000 $21,000 $15,000 $46,000 F $20,000 $12,000 $ 8,000 $12000 $(9.000 Jim Bean Company is thinking of discontinuing product line Fbecause it is reporting an operating loss. All fixed costs are unavoidable. Assume Jim Bean Company is able to increase the sales revenue of product F to $32,000 with no change in volume of units sold and no change in variable costs or fixed costs. What affect will this have on operating income? Increase $37,000 Increase $12,000 Decrease $12,000 Decrease $20,000
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