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Tyler Corporation has provided you with the following budgeted income statement for one of its products:

Sales revenue   $750,000
Variable costs   500,000
Contribution margin   $250,000
Fixed costs   280,000
Operating income (loss)   ($30,000)

Tyler Corporation believes that 70% of the fixed costs would be avoidable if the product line was dropped. Based on the impact on the company's operating income or loss, Tyler should keep the product line.
A) True
B) False
Textbook 
Horngren's Financial & Managerial Accounting, The Financial Chapters

Horngren's Financial & Managerial Accounting, The Financial Chapters


Edition: 5th
Authors:
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