Cesar Company has three product lines: A, B and C. The information givenbelow is available. Assume Cesar Company drops Product C. CesarCompany then doubles the production and sales of Product B without?increasing fixed costs. What will happen to operating incomeProduct BProduct CSalesVariable costsContribution marginAvoidable fixed costsUnavoidable fixed costsOperating income(loss)Product A$100,00076,00024,0009,0006,000$9.000$90,00048,00042,00018,0009,000$15.000$44,00035,0009,0003,0007,700S(1,700)increase by $42,000 Oincrease by $18,000increase by $36,000increase by $15,000 )increase by $24,000

Operating income means the revenue that is made by the business after deducting the expenses related…

Cesar Company has three product lines: A, B and C. The information given below is available. Assume Cesar Company drops Product C. Cesar Company then doubles the production and sales of Product B without ?increasing fixed costs. What will happen to operating income Product B $90,000 48,000 42,000 18,000 9,000 $15.000 Product C Product A $100,000 76,000 24,000 9,000 $44,000 35,000 9,000 3,000 Sales Variable costs Contribution margin Avoidable fixed costs 7,700 $(1.700) Unavoidable fxed costs 6,000 $9.000 Operating income(loss) increase by $42,000 O increase by $18,000 increase by $36,000 O increase by $15,000 O increase by $24,000 O

Cesar Company has three product lines: A, B and C. The information given below is available. Assume Cesar Company drops Product C. Cesar Company then doubles the production and sales of Product B without ?increasing fixed costs. What will happen to operating income Product B $90,000 48,000 42,000 18,000 9,000 $15.000 Product C Product A $100,000 76,000 24,000 9,000 $44,000 35,000 9,000 3,000 Sales Variable costs Contribution margin Avoidable fixed costs 7,700 $(1.700) Unavoidable fxed costs 6,000 $9.000 Operating income(loss) increase by $42,000 O increase by $18,000 increase by $36,000 O increase by $15,000 O increase by $24,000 O

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 11MCQ: Garrett Company provided the following information: Common fixed cost totaled 46,000. Garrett...

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