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Compute the monthly financial advantage

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Question - Lusk Corporation produces and sells 16,000 units of Product X each month. The selling price of Product X is $30 per unit, and variable expenses are $24 per unit. A study has been made concerning whether Product X should be discontinued. The study shows that $70,000 of the $110,000 in monthly fixed expenses charged to Product X would not be avoidable even if the product was discontinued. If Product X is discontinued, compute the monthly financial advantage (disadvantage) for the company of eliminating this product?

A. (56,000)

B. 14,000

C. 54,000

D. (54,000)

Reference no: EM132619417

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