Mr. Earl Pearl, accountant for Margie Knall Co., Inc., has prepared the following product- line income data: 112,000 $ Sales Product Total B 49,000 27,000 36,000 $ $ 62,200 29,800 21,400 11,000 $ Variable expenses 49,800 Contribution margin 19,200 16,000 14,600 Fixed expenses: Rent Depreciation Utilities Supervisors' salaries Maintenance Administrative expenses 6,800 7,800 4,940 5,940 2,980 11,800 2,300 2,800 1,800 1,300 1,300 2,800 2,000 2,200 640 640 740 3,000 2,500 2,800 2,500 4,000 940 6,000 Total fixed expenses 40,260 12,300 18,740 9,220 Net operating income $ 9,540 $6,900 $ 6,780 $ (4,140) The following additional information is available: The factory rent of $2,500 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 $2,500 to $940. All supervisors' salaries are avoidable. If Product C is discontinued. the maintenance department will be able to reduce on torrent The following additional information is available: The factory rent of $2,500 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 $2,500 to $940. All supervisors' salaries are avoidable. If Product C is discontinued, the maintenance department will be able to reduce monthly expenses from $2,980 to $1,800. Elimination of Product C will make it possible to cut two persons from the administrative staff; their combined salaries total $4,400. Required: 1. Calculate the advantage or disadvantage in dropping Product C. (Input the amount as a positive value. Omit the "$" sign in your response.) (Click to select) v in dropping Product $ 2. Should the product be dropped? O Yes