Marinette Company makes several products, including canoes. The company has been experiencing losses from its canoe segment and is considering dropping that product line. The following information is available regarding its canoe segment.

MARINETTE COMPANY Income StatementCanoe Segment
Sales			$	2,000,000
Variable costs
Direct materials	$	450,000
Direct labor		500,000
Variable overhead		300,000
Variable selling and administrative		200,000
Total variable costs				1,450,000
Contribution margin				550,000
Fixed costs
Direct		375,000
Indirect		300,000
Total fixed costs				675,000
Net income			$	(125,000)

1.	If canoes are discontinued, calculate the net income lost or gained.