The Income Statement for Sweet Dreams Company Is Divided by Its

The income statement for Sweet Dreams Company is divided by its two product lines,blankets and pillows,as follows:
$\begin{array}{|l|r|r|r|} \hline&{\text { Blankets }} &{\text { Pillows }} & {\text { Total }} \\\hline \text { Sales revenue } & \$ 720,000 & \$ 320,000 & \$ 1,040,000 \\\hline \text { Variable costs } & \underline{265,000} & \underline{260,000} & \underline{525,000} \\\hline \text { Contribution margin } & 455,000 & 60,000 & 515,000 \\\hline \text { Fixed costs } & \underline{76,000} & \underline{106,000} & \underline{182,000} \\\hline \text { Operating income (loss) } & \$ 379,000 & \underline{\$(46,000} & \$ \$ 333,000 \\\hline\end{array}$ If Sweet Dreams can eliminate total fixed costs of $32,000 by dropping the pillows line,operating income will increase by $46,000.