Geo Company's Western Territory's Forecasted Income Statement for the Upcoming

Geo Company's western territory's forecasted income statement for the upcoming year is as follows:

The company's management is considering dropping the western territory and has determined that 90% of the fixed costs are avoidable.What is the change in the forecasted operating loss for the upcoming year if the western territory is dropped? Assume the company predicts an operating loss across the entire company.

A) The loss will be reduced by $111,000.
B) The loss will be increased by $111,000.
C) The loss will be reduced by $441,000.
D) The loss will be increased by $441,000.