HiTech manufactures two products: Regular and Super. The results of operations for 20x1 follow.

	Regular	Super	Total
Units	13,000	4,100	17,100
Sales	$325,000	$779,000	$1,104,000
Less: Cost of goods sold	247,000	451,000	698,000
Gross margin	$78,000	$328,000	$406,000
Less: Selling expenses	78,000	190,000	268,000
Operating income	$0	$138,000	$138,000

Fixed manufacturing costs included in cost of goods sold amount to $2 per unit for Regular and $20 per unit for Super. Variable selling expenses are $3 per unit for Regular and $20 per unit for Super; remaining selling amounts are fixed. HiTech wants to drop the Regular product line. If the line is dropped, company-wide fixed manufacturing costs would fall by 20% because there is no alternative use of the facilities. What would be the impact on operating income if Regular is discontinued?

$0.

$21,600 increase.

$39,000 increase.

$43,400 decrease.

None of these.