Coronado Company makes three models of tasers. Information on the three products is given below.

Tingler		Shocker		Stunner
Sales		$300,000		$500,000		$200,000
Variable expenses		152,500		198,500		137,400
Contribution margin		147,500		301,500		62,600
Fixed expenses		121,200		232,100		95,100
Net income		$26,300		$69,400		$(32,500)

Fixed expenses consist of $304,000 of common costs allocated to the three products based on relative sales, as well as direct fixed expenses unique to each model of $30,000 (Tingler), $80,100 (Shocker), and $34,300 (Stunner). The common costs will be incurred regardless of how many models are produced. The direct fixed expenses would be eliminated if that model is phased out. James Watt, an executive with the company, feels the Stunner line should be discontinued to increase the companys net income.

(a) Compute current net income for Coronado Company.

Net income

$

(b) Compute net income by product line and in total for Coronado Company if the company discontinues the Stunner product line. (Hint: Allocate the $304,000 common costs to the two remaining product lines based on their relative sales.)

Tingler Net Income		$
Shocker Net Income		$
Total Net Income		$

(c) Should Coronado eliminate the Stunner product line? NoYes Why or why not?

Net income would increasedecrease from $ to $ .