MSI is considering eliminating a product from its ToddleTown Tours collection. This collection is aimed at children one to three years of age and includes "tours" of a hypothetical town. Two products, The Pet Store Parade and The Grocery Getaway, have impressive sales. However, sales for the third CD in the collection, The Post Office Polka, have lagged the others. Several other CDs are planned for this collection, but none is ready for production. MSI's information related to the ToddleTown Tours collection follows: Segmented Income Statement for MSI's Toddle Town Tours Product Lines Post Pet Store Grocery Office Parade Getaway Polka Total S55,000 $50,000 S20,000 $125,000 25,000 21,000 5,000 61,000 5,000 S 64,000 4,000 2,400 $25,000 $25,600 $ 1,000 $ 51,600 5,120 32,000 $10,920 S12,800S (4,20) S 19,600 Sales revenue Variable costs ,000 9.000 s Contribution margin Segment margin Net operating income (loss) Less: Direct Fixed costs 3,400 Less: Common fixed costs 4,080 2,800 Allocated based on total sales dollars. MSI has determined that elimination of the Post Office Polka (POP) program would not impact sales of the other two items. The remaining fixed overhead currently allocated to the POP product would be redistributed to the remaining two products. Required: .Calculate the incremental effect on profit if the POP product is eliminated. on Profit 2. Should MSI drop the POP product? Yes O No 3-a. Calculate the incremental effect on profit if the POP product is eliminated. Suppose that $4,000 of the common fixed costs could be avoided if the POP product line were eliminated. Effect on Profit