Cinderella Inc. prepared monthly operating income for the month of April below. Additional information related to the month was as follows. 2 3 4 Sales 5 Variable Costs Contribution Margin Direct Fixed Expenses Line Segment Margin Line A Line B Line C $ 100,000 $ 135,000 $ 210,000 58,000 98,000 125,000 42,000 37,000 85,000 35,000 32,000 50,000 7,000 5,000 35,000 8,000 6,000 15,000 -1,000 -1,000 20,000 Allocated Fixed Expenses 0 1 2 3 1.68% of all direct fixed expenses are avoidable if a line is discontinued. 4 $2. Arial allocates common fixed expenses to each line on the basis of sales dollars. Allocated fixed expenses are unavoidable. E 6 3. The controller for the company estimated that discontinuing line A would result in a 15% increase in Line C sales, and discontinuing Line B would result in a 10% 7 increase in Line C sales a 94. April results are representative of what a typical month for the company's operations look like. 0 REQUIRED 1 A) Calculate the net benefit or loss of discontinuing line A. Use incremental analysis (do not use an income statement). 2 36) Calculate the net benefit or loss of discontinuing line B. Use Incremental analysis (do not use an income statement). 4 SCWhich line should the company discontinue? Briefly explain.