urel Inc. has three product lines: A, B, and C. A B C Total Sales $20,000 $35,000 $22,000 $77,000 Variable costs 8,000 10,000 14,000 32,000 Contribution margin 12,000 25,000 8,000 45,000 Fixed costs 4,000 11,000 9,000 24,000 Net income S 8,000 $14,000 $ (1,000) $21.000 26. Management is considering dropping product line C. If it is discontinued, 12 of its fixed costs are DTFC and can be avoided. The discontinuation of product line C would: A. decrease net income by $3,500. B. increase net income by $1,000. C. decrease net income by $500. D. increase net income by $3,500. 27. Management is considering dropping product line C. If it is discontinued, (1) all of its fixed costs are Common and cannot be avoided and (2) the selling price of Product A would increase by 45%. The discontinuation of product line C would: A. decrease net income by $3,500. B. increase net income by $1,000. C. decrease net income by $500. D increase net income by $3,500 28. Management is considering dropping product line C. If it is discontinued, (1) all of its fixed costs are common and cannot be avoided and (2) the sales of Product B would increase by 30%. The discontinuation of product line C would: A. decrease net income by $3,500. B. increase net income by $1,000. C. decrease net income by $500. Dincrease net income by $3,500