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.