5 Profits have been decreasing for several years at Pegasus Airlines in an effort to improve the company's performance, the company is thinking about dropping several flights that appear to be unprofitable. A typical income statement for one round-trip of one such fight (ight 482) is as follows: Ticket revenue (175 seats 4es occupancy 5250 ticket price) $ 17,500 100 Variable expenses (517,00 per person) Contribution margin 16, 110 Flight expenses Salaries, Flight crew 53, Fight promotion Depreciation of aircraft 1,70 Fuel for aircraft Liability insurance 4,800 Salaries, Flight assistant 1,400 Bare loading and fight preparation 1.95 Overnight costs for fight crew and sistants et destination so Total flight expenses 18. Net operating 1013 52,00) 33:29 The following additional information is available about fight 482 a. Members of the flight crew are paid foxed annual salaries, whereas the fight assistants are paid based on the number of round trips they complete b. One-third of the liability Insurance is a special charge assessed against flight 482 because in the opinion of the insurance company the destination of the flight is in a "high-risk area. The remaining two-thirds would be unaffected by a decision to drop flight 482 c. The baggage loading and flight preparation expense is an allocation of ground crews' salaries and depreciation of ground equipment Dropping flight 482 would have no effect on the company's total baggage loading and fight preparation expenses d. If flight 482 is dropped, Pegasus Airlines has no authorization at present to replace it with another fight. e Aircraft depreciation is due entirely to obsolescence Depreciation due to wear and tear is negligible 1 Dropping fight 482 would not allow Pegasus Airlines to reduce the number of aircraft in its fleet or the number of flight crew on its payroll Required: 1. What is the financial advantage disadvantage of discontinuing fight 4822