Solve this accounting questions A company has three product lines, one of which reflects the following results:SalesVariable expenses$340,000200,000Contribution margin 140,000Fixed expensesNet loss220,000$(80,000)If this product line is eliminated, 60% of the fixed expenses can be eliminated andthe other 40% will be allocated to other product lines. If management decides toeliminate this product line, the company's net income will:A) increase by $80,000.B) decrease by $140,000.C) decrease by $8,000.D) increase by $8,000.

Step 1: Define Net IncomeCompanies assess the net income of their projects to check the actual…

Answered: A company has three product lines, one…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14EB: Company A has current sales of $4,000,000 and a 45% contribution margin. Its fixed costs are...

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