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Question 145

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Use the information below to answer the following question(s) :
Aqua Life Jackets, Inc. has two product lines: adult jackets and children's jackets. Contribution margin income statement data for the most recent year follow:
Use the information below to answer the following question(s) : Aqua Life Jackets, Inc. has two product lines: adult jackets and children's jackets. Contribution margin income statement data for the most recent year follow:    -Assuming total fixed costs at Aqua Life Jackets, Inc. remain unchanged, how would dropping the children's jackets line affect operating income? A)  Increase in total operating income of $8,000 B)  Increase in total operating income of $2,000 C)  Decrease in total operating income of $50,000 D)  Decrease in total operating income of $90,000
-Assuming total fixed costs at Aqua Life Jackets, Inc. remain unchanged, how would dropping the children's jackets line affect operating income?


A) Increase in total operating income of $8,000
B) Increase in total operating income of $2,000
C) Decrease in total operating income of $50,000
D) Decrease in total operating income of $90,000

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