Answer:
Operating income $ 7860 if the Round Trivia Game had not been produced or sold.
Explanation:
Blossom Trivia Co. Manufacturers
Square Trivia Game Round Trivia Game Total
Sales revenue $17,800 $6,620 $24,420
Variable expenses 4,520 2,900 7,420
Contribution margin 13,280 3,720 17,000
Fixed expenses 2,900 4,200 7,100
Operating income $ 10,380 $(480 ) $ 9,900
40% of Round Game fixed Costs= 40 % of 4,200= $1680
Unavoidable fixed costs= 4200- 1680= $ 2520
Adding these unavoidable fixed costs to the Square Trivia Game would give the company an operating income of $ 7860
Blossom Trivia Co. Manufacturers
Square Trivia Game
Sales revenue $17,800
Variable expenses 4,520
Contribution margin 13,280
Fixed expenses 2,900 + 2520= $ 5420
Operating income $ 7860
