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Soar Incorporated is considering eliminating its mountain bike division, which reported an operating loss for the recent year of $1,000. The division sales for the year were $1,046,000 and the variable costs were $856,000. The fixed costs of the division were $189,000. If the mountain bike division is dropped, 30% of the fixed costs allocated to that division could be eliminated. The impact on operating income for eliminating this business segment would be:
a) $133,300 decrease
b) $190,000 increase
c) $190,000 decrease
d) $54,100 decrease
e) $56,700 decrease
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