Hanyoo Transportation Co is thinking about dropping its freight car product line. Determine whether or not they should or shouldn't

	Ships	Locomotives	Freight cars
Sales	$400,000	$850,000	$623,000
Variable Exp	102,000	534,302	342,000
Fixed Exp
Salaries of Line Workers	55,000	28,700	54,000
Advertising of Products	45,000	23,000	63,000
Utilities of Factory	5,000	7,000	10,000
Depreciation	15,000	16,000	54,000
Company Insurance	32,000	24,023	65,000
Total Fixed Costs	152,000	98,723	311,000
Net Operating Income/Loss	146,000	216,975	(30,000)

a.) If Hanyoo drops the freight car product line, it can use the idle factory space to start producing housewares which will give it a segment, margin of $60,000 per year. Calculate the financial advantage/disadvantage of dropping the product line.

b.) Hanyoo purchased a special freight-car manufacturing robot costing $170,000 before it started producing freight cars. Is this cost relevant to deciding whether or not Hanyoo should drop the product line? If it is, what would the new financial advantage/disadvantage be to dropping the product line?