Alta Loma Industries has three product lines, A, B, and C. The following information is available: A B C Sales $100,000 $90,000 $36,000 Variable costs 76,000 48,000 27,000 Contribution margin $24,000 $42,000 $9,000 Fixed costs: Avoidable 9,000 18,000 3,000 Unavoidable 6,000 9,000 8,400 Operating income $9,000 $15,000 $(2,400) Assume that product line C is discontinued and replaced with product line B. This will double the production and sales of product line B without increasing fixed costs. Operating income will:.
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Alta Loma Industries has three product lines, A, B, and C. The following information is available: A...
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