Which of the Following Statements Describes a Scenario When Management

Multiple Choice

Which of the following statements describes a scenario when management should consider dropping a business division?

A) The division has been consistently reporting an operating loss.
B) The division's avoidable fixed costs are less than its contribution margin.
C) The division's avoidable fixed costs are greater than its contribution margin.
D) The division's unavoidable fixed costs are greater than its operating loss.