Astudy has been conducted to determine if product a should be dropped. sales of the product total $400,000 per year; variable expenses total $270,000 per year. fixed expenses charged to the product total $160,000 per year. the company estimates that $70,000 of these fixed expenses are not avoidable even if the product is dropped. if product a is dropped, the company's overall net operating income would:
a. decrease by $40,000 per yearb. increase by $40,000 per yearc. decrease by $30,000 per yeard. increase by $30,000 per year