Jim Bean Company Has Three Product Lines: D,E,and F

Multiple Choice

Jim Bean Company has three product lines: D,E,and F.The following information is available:
Jim Bean Company is thinking of discontinuing product line F because it is reporting an operating loss.All fixed costs are unavoidable.Assume Jim Bean Company is able to increase the sales revenue of product F to $32,000 with no change in volume of units sold and no change in variable costs or fixed costs.What affect will this have on operating income?

A) Increase $37,000
B) Increase $12,000
C) Decrease $12,000
D) Decrease $20,000