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Question - Blossom Daniel, the controller of Inca Industries, has prepared an analysis to help management determine whether one of Inca's departments should be eliminated. The department's contribution margin is $56000. The fixed expenses charged to the department total $90000. Of the fixed expenses, Daniel estimates that $44000 of those expenses would be eliminated if the department were discontinued. Based on Daniel's analysis, if the department is eliminated, what the Inca's overall operating income?
a. decrease by $34000 per year.
b. decrease by $10000 per year.
c. increase by $12000 per year.
d. decrease by $12000 per year.
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