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The following information is for X Company's two products - A and B: ...

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Accounting

The following information is for X Company's two products - A and B:

Product A Product B
Revenue $85,000 $93,000
Variable Costs 49,300 54,870
Fixed costs $52,590 $26,690
Profit $-16,890 $11,440

$7,363 of Product A's fixed costs are directly related to Product A; $4,537 of Product B's fixed costs are directly related to Product B. All other fixed costs are allocated to the individual products. X Company is considering droping Product A because of its reported loss

If it drops Product A, what will be the effect on firm profits?

A: $-25,077 B: $-28,337 C: $-32,021 D: $-36,184 E: $-40,888 F: $-46,203

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