Contribution margin income statement data for the most recent year follow: total cat food dog food sales revenue $385,000 $300,000 $85,000 variable expenses $205,000 $165,000 $40,000 contribution margin $180,000 $135,000 $45,000 fixed expenses $102,000 $50,000 $52,000 operating income (loss) $78,000 $85,000 $(7,000) assuming the dog food line is discontinued, and all fixed costs will go away, how will operating income be affected?

Exercise 7-7 martinez company reports the following financial information before adjustments. dr. cr. accounts receivable $168,900 allowance for doubtful accounts $3,200 sales revenue (all on credit) 849,300 sales returns and allowances 50,440 prepare the journal entry to record bad debt expense assuming martinez company estimates bad debts at (a) 4% of accounts receivable and (b) 4% of accounts receivable but allowance for doubtful accounts had a $1,550 debit balance. (if no entry is required, select "no entry" for the account titles and enter 0 for the amounts. credit account titles are automatically indented when the amount is entered. do not indent manually.)