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What would be the impact on net operating income

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Question - Tim Corporation is considering dropping product XYZ. Data from the company's accounting system appear below.

Sales $300,000

Variable expenses 160,000

Fixed manufacturing overhead 100,000

Fixed selling and administrative expenses 80,000

20% of the fixed manufacturing overhead and 10% of the fixed selling and administrative expenses may be avoided if product XYZ is dropped. What would be the impact on net operating income if the product line was dropped? Please show your work.

Reference no: EM131830120

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