Seidman Company Manufactures and Sells 30,000 Units of Product X

Multiple Choice

Seidman Company manufactures and sells 30,000 units of product X per month.Each unit of product X sells for $16 and has a contribution margin of $7.If product X is discontinued,$85,000 in fixed monthly overhead costs would be eliminated and there would be no effect on the sales volume of Seidman Company's other products.If product X is discontinued,Seidman Company's monthly income before taxes should:

A) Increase by $210,000.
B) Increase by $125,000.
C) Decrease by $210,000.
D) Decrease by $125,000.