Manor Company plans to discontinue a department that has a contribution margin of $24,000 and $48,000 in fixed costs.Of the fixed costs,$21,000 cannot be avoided.The effect of this discontinuance on Manor's overall net operating income would be a(an):
A) decrease of $3,000.
B) increase of $3,000.
C) decrease of $24,000.
D) increase of $24,000.

Question

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The Answer of Manor Company plans to discontinue a department that has a contribution margin of $24,000 and $48,000 in fixed costs.Of the fixed costs,$21,000 cannot be avoided.The effect of this discontinuance on Manor's overall net operating income would be a(an):
A) decrease of $3,000.
B) increase of $3,000.
C) decrease of $24,000.
D) increase of $24,000.

Manor Company Plans to Discontinue a Department That Has a Contribution