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Benace Parts and Supply makes a variety of car parts. The company produces 6,000 A90 parts each year

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Benace Parts and Supply makes a variety of car parts. The company produces 6,000 A90 parts each year

Benace Parts and Supply makes a variety of car parts. The company produces 6,000 A90 parts each year. Each A90 sells for $7 and has a contribution margin of $2. Currently, $16,000 of fixed manufacturing overhead is allocated to the A90 product line. If Benace Parts and Supply discontinues the A90 product line, $7,000 of fixed manufacturing overhead costs would be avoided. What would be the impact on total operating income if the A90 product line were to be discontinued?
A) Decrease in total operating income of $4,000
B) Increase in total operating income of $5,000
C) Increase in total operating income of $4,000
D) Decrease in total operating income of $5,000

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Managerial Accounting

Edition: 4^th

Author: Braun

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Wow! Thank you

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THANK YOU

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