> Boots Plus has two product lines: Hiking boots and Fashion boots. Income statement data...
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> Boots Plus has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Total $500,000 375,000 125,000 81,000 $44,000 Hiking $360,000 255,000 105,000 40,500 $64,500 Fashion $140,000 120,000 20,000 40,500 $(20,500) Assuming the Fashion line is discontinued, total fixed costs remain unchanged, and the space formerly used to produce the line is rented for $30,000 per year, how will operating income be affected? A. Decrease $10,000 B. Increase $54,000 C. Increase $10,000 D. Increase $98,000
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