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Question - Pharoah Company is deciding whether or not to discontinue one of its divisions. The division's contribution margin is $30000 per year. The fixed costs charged to the division total $37000, but $18000 would be eliminated if the division is discontinued. If the division is eliminated, determine the overall operating income?
a. increase by $30000.
b. decrease by $18000.
c. decrease by $12000.
d. decrease by $11000.
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