The income statement for Germain Appliances is divided by its two product lines, Toasters and...
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Accounting
The income statement for Germain Appliances is divided by its two product lines, Toasters and Microwaves, as follows: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Toaster $620,000 $480,000 $140,000 $95,000 $45,000 Microwave $255,000 $210,000 $45,000 $95,000 $(50,000) Total $875,000 $690,000 $185,000 $190,000 $(5,000) If Germain Appliances can eliminate fixed costs of $34,000 by discontinuing the Microwave line, then discontinuing it should result in which of the following? O A. Increase in total operating income of $(5,000) B. Increase in total operating income of $11,000 O C. Decrease in total operating income of $11,000 OD. Decrease in total operating income of $(5,000)
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