Momentum Rollerblades has three product lines: D, E, and F. The following information is available:

D E F
Sales revenue $90,000 $40,000 $30,000
Variable costs (40,000) (10,000) (10,000)
Contribution margin $50,000 $30,000 $20,000
Fixed costs (10,000) (5,000) (25,000)
Operating income (loss) $40,000 $25,000 ($5,000)

The company is deciding whether to drop product line F because it has an operating loss. Assume that $21,000 of total fixed costs could be eliminated by dropping F. What effect would this decision have on operating income?

A. Operating income will decrease by $2000.

B. Operating income will increase by $24,000.

C. Operating income will decrease by $24,000.

D. Operating income will increase by $2000.

Prepare the operating activities section—indirect method.(lo 4), apthe income statement of paxson company is presented here.paxson companyincome statementfor the year ended november 30, 2014sales revenue $7,600,000cost of goods sold beginning inventory$1,900,000 purchases4,400,000goods available for sale6,300,000 ending inventory1,600,000total cost of goods sold 4,700,000gross profit 2,900,000operating expenses selling expenses450,000 administrative expenses700,0001,150,000net income $1,750,000additional information: prepare the operating activities section—indirect 1. accounts receivable decreased $380,000 during the year, and inventory decreased $300,000.2. prepaid expenses increased $150,000 during the year.3. accounts payable to suppliers of merchandise decreased $350,000 during the year.4. accrued expenses payable decreased $100,000 during the year.5. administrative expenses include depreciation expense of $110,000.instructionsprepare the operating activities section of the statement of cash flows for the year ended november 30, 2014, for paxson company, using the indirect method.net cash provided $1,940,000