Mickey Tire Company Makes a Special Kind of Racing Tire

Mickey Tire Company makes a special kind of racing tire.Variable costs are $230 per unit,and fixed costs are $20,000 per month.Mickey sells 300 units per month at a sales price of $350.If the quality of the tire is upgraded,the company believes it can increase the sales price to $380.If so,the variable cost will increase to $250 per unit,and the fixed costs will rise by 15%.If Mickey decides to upgrade,how will operating income be affected?

A) Operating income will decrease by $3000.
B) Operating income will decrease by $6000.
C) Operating income will increase by $6000.
D) Operating income will remain the same.