Michael was enjoying a nice backyard barbecue at his friend's house when he sat down on one of the deck chairs and noticed that the fabric was all frayed and almost splitting apart! He quickly moved to a different chair, but the host, Arianny, noticed his sudden move and apologized. "Sorry, Michael. I meant to put that chair into storage. I realized that some of these have really deteriorated in the elements, so I tried to go back to the manufacturer to buy replacement fabric, but they don't carry anything like this anymore. I guess I'm out of luck" (b) Your Answer Correct Answer (Used) Assume the furniture company based its decision to drop this product line on the following financials. Fabric lawn chairs Sales $257,000 Variable costs 205,500 Contribution margin 51,500 Fixed costs 83,000 Operating income ($31,500) Assume that at the time of their decision, the company felt it could save $38,500 in fixed costs related to this product line. Given this information, do you agree with the company's decision to drop this product line, based on quantitative information only? No The company would be worse off by $ 13,000 1 (c1) Use the financial information provided in part (b), along with the following information. Assume the company believes it can save just $33,000 in fixed costs if it drops this product line. Additionally, it could rent the newly available space to an outside vendor for $18,500. Under these conditions, should the chair manufacturer keep or drop this product line? (Enter O if no net effect. Do not leave answer field blank.) Net effect $ The company eTextbook should drop the product line should keep the product line would be Indifferent