Luther Company, located in Largeville, Kansas (USA) is a retailer of durable, light-weight luggage products known for their high-quality and innovation Recently, the fem conducted a relevant cost analysis of one of its product lees that has only two products, Kryptonite and Meteorite Sales for Meteorite are decreasing, while purchase costs increasing. The firm is considering dropping the Meteorite product and only selling Kryptonite Luther Company allocates fixed costs both corporate and selling/administrative) to products based on sales revenue When the president of the company saw the product line income statements i presented below), he agreed that the Meteorte product should be dropped. If this is done, sales of Kryptonite are expected to increase by 15% next year; the firm's cost structure will remain the same Kryptonite Meteorite Sales $200,000 $320,000 Cast of goods sold (all variable)) 90,000 160,000 Gross margin 110,000 160,000 Operating Expenses Flaed corporate custs 60,000 50,000 Variable selling and administrative expenses 22,000 59,000 Fleed selling and adinistrative genes 12,000 18,000 Total Operating Expenses 1,000 167,000 Operating Income (less) $16,000 5 (7,000) 1 Find the expected change in annual operating income by dropping the Meteoote product and selling only the Kryptonite product 2. What hategic factors should be considered