Multiple Choice
DM Corporation has provided you with the following budgeted income statement for one of their products: 
DM has just encountered environmental problems with the product and will be forced to drop the product line altogether. They will be able to eliminate 75% of the fixed expenses. What will be the impact on operating income of the company?
A) Operating income will decrease by $195,000.
B) Operating income will decrease by $45,000.
C) Operating income will increase by $240,000.
D) Operating income will increase by $55,000.
Correct Answer:
Verified
Correct Answer:
Verified
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