The Income Statement for Germain Appliances Is Divided by Its

Multiple Choice

The income statement for Germain Appliances is divided by its two product lines, Toasters and Microwaves, as follows: If Germain Appliances can eliminate fixed costs of $34,000 and increase the sale of Toasters by 6300 units at a selling price of $30 per unit and a contribution margin of $12 per unit, then discontinuing the Microwaves should result in which of the following?

A) Increase in total operating income of $64,600
B) Increase in total operating income of $30,600
C) Decrease in total operating income of $64,600
D) Decrease in total operating income of $30,600