Net operating income

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Licuado Juice Company has four product lines; Orange, Tomato, Carrot, and Grape. Shown below is last year's income statement segmented by product line: Orange Tomato Carrot Grape Sales $60,000 $32,000 $24,000 $44,000 Variable expenses 22,800 11,200 12,000 17,600 Contribution Margin $37,200 $20,800 $12,000 $26,400 Traceable fixed expenses 12,000 8,000 9,000 6,600 Segment margin $25,200 $12,800 $3,000 $19,800 Net operating income last year for Licuado Company as a whole was $24,800. If the Carrot product line would have been dropped at the beginning of last year, how would this have changed the net operating income of Licuado Company as a whole?

a.) $2,400 increase

b.) $3,000 decrease

c.) $5,400 increase

d.) $12,000 decrease

Reference no: EM13912807

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