Kane Manufacturing has three product lines: A, B, and C. The following information is available for each product line:

	A		B		C		Total
Sales	$600,000		$450,000		$300,000		$1,350,000
Variable costs	200,000		150,000		230,000		580,000
Contribution margin	400,000		300,000		70,000		770,000
Fixed costs	75,000		60,000		85,000		220,000
Net income	$325,000		$240,000		$(15,000)		$550,000

Management is considering dropping product line C. Required:

A.	What is one qualitative factor that Kane should consider before dropping product line C? The input in the box below will not be graded, but may be reviewed and considered by your instructor.
	_________________
B.	If it is determined that all of product line C's fixed costs are avoidable, what would be the effect on the company's overall net income if it were dropped?
	Overall net income would _________________ by $ ________ .
C.	If it is determined that none of product line C's fixed costs are avoidable, what would be the effect on the company's overall net income if it were dropped?
	Overall net income would _________________ by $ ________ .
D.	If it is determined that half of product line C's fixed costs are avoidable, what would be the effect on the company's overall net income if it were dropped?
	Overall net income would _________________ by $ ________ .