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1. Soar Incorporated is considering eliminating its mountain bike division, which reported an operating loss...

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Accounting

1. Soar Incorporated is considering eliminating its mountain bike division, which reported an operating loss for the recent year of $2,000. The division sales for the year were $1,049,000 and the variable costs were $859,000. The fixed costs of the division were $192,000. If the mountain bike division is dropped, 30% of the fixed costs allocated to that division could be eliminated. The impact on operating income for eliminating this business segment would be: a. 57600 decrease b. 132400 decrease c. 54700 decrease d. 190000 decrease e. 190000 increase

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