Victory Tire Company Makes a Special Kind of Racing Tire

Victory Tire Company makes a special kind of racing tire.Variable costs are $210 per unit,and fixed costs are $30,000 per month.Victory sells 700 units per month at a sales price of $310.If the quality of the tire is upgraded,the company believes it can increase the sales price to $350.If so,the variable cost will increase to $240 per unit,and the fixed costs will remain the same.If Victory decides to upgrade,how will it affect operating income?

A) Operating income will decrease by $7,000.
B) Operating income will decrease by $21,000.
C) Operating income will increase by $21,000.
D) Operating income will increase by $7,000.