Making a decision to add or drop a product. In addition to the information given in Exercise 1, refer to the following information relating to the income statement for Super-Widgets:

a. Variable manufacturing costs, $30 per unit.

b. Fixed manufacturing costs, $45,000.

c. Of the fixed costs, $20,000 is directly related to the production of Super-

Widgets and would be eliminated if Super-Widgets were discontinued.

d. Variable operating expenses per unit, $5.

e. Fixed operating expenses, $15,000. (None of the fixed operating expenses would be eliminated by discontinuing Super-Widgets.)

Based on measurable data, should Super-Widgets be discontinued?