Total $920,000 (540,000) $380,00 (162,000) $218,000 Batting Helmets Football Hel

Question

Total $920,000 (540,000) $380,00 (162,000) $218,000 Batting Helmets Football Helmets Sales revenue Variable costs $600,000 (250,000) $350,000 (70,000) $280,000 $320,000 (290,000) $30,000 (92,000) $(62,000) Fixed costs Operating income (loss) Assuming the football heimet line is dropped, total fixed costs remain unchanged, and the space formerly used to produce the football helmet line is used to double the production of batting helmets, operating income will be O A $538,000 O B. S350.000 OC. $162,000 O D. $280,000

Explanation / Answer

Contribution margin of Batting helmets 700000 =350000*2 Less: Fixed costs 162000 Operating income (loss) 538000 Option A is correct

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