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What the effect of eliminating this department on fabio

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Reference no: EM132812427

Problem 1: Fabio Corporation is considering eliminating a department that has a contribution margin of $30,000 and $60,000 in fixed costs. Of the fixed costs, $15,000 cannot be avoided. The effect of eliminating this department on Fabio's overall net operating income would be:

(a) A decrease of $30,000
(b) An increase of $30,000
(c) A decrease of $15,000
(d) An increase of $15,000

Reference no: EM132812427

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