The effect on a company's operating income of discontinuing a department
The effect on a company’s operating income of discontinuing a department
with a contribution margin of $8,000 and allocated overhead of $16,000 (of which $7,000 cannot be eliminated would be to :
A. Decrease operating income by $9,000
B. Decrease Operating Income by $1,000
C. Increase operating income by $8,000
D. Decrease operating income by $8,000
E. Increase Operating income by $1,000
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