The Following Information Relates to Next Year's Projected Operating Results

Multiple Choice

The following information relates to next year's projected operating results of the Consumer Division of Xampa Corporation: If the Consumer Division is eliminated, $1, 600, 000 of the above fixed expenses could be avoided.What will be the effect on Xampa's profit next year if Consumer Division is eliminated?

A) $300, 000 increase
B) $300, 000 decrease
C) $200, 000 decrease
D) $200, 000 increase