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Find what would be the effect of discontinuing department

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Reference no: EM132608287

Problem 1: Manor Company plans to discontinue a department that has a contribution margin of $24,000 and $48,000 in fixed costs. Of the fixed costs, $21,000 cannot be avoided. What would be the effect of discontinuing the department on Manor's overall operating income?

A) A decrease of $3,000.

B) An increase of $3,000.

C) An increase of $24,000.

D) A decrease of $24,000.

Reference no: EM132608287

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