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Mr. Earl Pearl, accountant for Margie Knall Co., Inc., has prepared the following product-line income data: The following additional information is available: The factory rent
Mr. Earl Pearl, accountant for Margie Knall Co., Inc., has prepared the following product-line income data: The following additional information is available: The factory rent of $1, 700 assigned to Product C is avoidable if the product were dropped. The company's total depreciation would not be affected by dropping C. Eliminating Product C will reduce the monthly utility bill from $1, 700 to $970. All supervisors' salaries are avoidable. If Product C is discontinued, the maintenance department will be able to reduce monthly expenses from $2, 980 to $2, 500. Elimination of Product C will make it possible to cut two persons from the administrative staff, their combined salaries total $1, 100. Calculate the advantage or disadvantage in dropping Product C. (Input the amount as a positive value. Omit the "$" sign in your response.) Should the product be dropped? Yes No
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