The following income statement is for X Company's two products, A and B: ...
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Accounting
The following income statement is for X Company's two products, A and B:
| Product A | Product B | |||
| Revenue | $91,000 | $85,000 | ||
| Total variable costs | 50,960 | 45,050 | ||
| Total contribution margin | $40,040 | $39,950 | ||
| Total fixed costs | ||||
| Avoidable | 15,406 | 28,901 | ||
| Unavoidable | 12,104 | 25,629 | ||
| Profit | $12,530 | $-14,580 | ||
If X Company drops Product B because it shows a loss and is able to use the vacant space to increase sales of Product A by $28,100, with $5,000 of additional fixed costs, what will be the effect on firm profits?
| A: $-2,886 | B: $-3,261 | C: $-3,685 | D: $-4,164 | E: $-4,706 | F: $-5,317 |
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