Muscle Beach, Inc., makes three models of high-performance weight-training benches. Current operating data are summarized here:

MegaMuscle PowerGym ProForce Selling price per unit $ 136 $ 202 $ 290

Contribution margin per unit 41 78 59

Monthly sales volumeunits 2,930 2,030 1,070

Fixed expenses per month Total of $315,400

e1 Management is considering the elimination of the ProForce model due to its low sales volume and low contribution margin ratio. As a result, total fixed expenses can be reduced to $259,800 per month. Assuming that this change would not affect the other models, what would be the effect on net operating income.

f1 Assume the same facts as in requirement e-1. Assume also that the sales volume for the PowerGym model will increase by 500 units per month if the ProForce model is eliminated. What would be the effect on operating income.