The income statement for Orange Company is divided by its two product lines, juice and...
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The income statement for Orange Company is divided by its two product lines, juice and fruit, as follows: Juice Fruit Total Sales revenue $620,000 $298,000 $918,000 Variable costs (455,000) (241,000) (696,000) Contribution margin $165,000 $57,000 $222,000 Fixed costs (76,000) (75,000) (151,000) Operating income (loss) $89,000 $(18,000) $71,000
Orange Company is considering eliminating the fruit product line. If this line is eliminated, Orange Company will be able to eliminate $73,000 of total fixed costs. By how much would this business decision increase operating income? Group of answer choices $73,000 $132,000 $57,000 $16,000
The income statement for Orange Company is divided by its two product lines, juice and fruit, as follows:
Orange Company is considering eliminating the fruit product line. If this line is eliminated, Orange Company will be able to eliminate $73,000 of total fixed costs. By how much would this business decision increase operating income?
| Juice | Fruit | Total | |
| Sales revenue | $620,000 | $298,000 | $918,000 |
| Variable costs | (455,000) | (241,000) | (696,000) |
| Contribution margin | $165,000 | $57,000 | $222,000 |
| Fixed costs | (76,000) | (75,000) | (151,000) |
| Operating income (loss) | $89,000 | $(18,000) | $71,000 |
Group of answer choices
$73,000
$132,000
$57,000
$16,000
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