The income statement for Sweet Dreams Company is divided by its two product lines, blankets and) pillows, as follows:
Blankets Pillows Total
Sales revenue $620,000 $300,000 $920,000
variable expenses 465,000 240,000 705,000
Contribution margin 155,000 60,000 215,000
Fixed expenses 76,000 76,000 152,000
Operating income(loss) 79,000 (16,000) 63,000
Sweet Dreams is considering eliminating the pillow product line. If they do so, they will be able to eliminate $76,000 of total fixed costs. In that event, how would that business decision impact operating income?
A) Increase $42,000
B) Increase $76,000
C) Decrease $60,000
D) Increase $16,000