Question 1 Manama Company has two products H13 and H14. The company is considering to drop products H13 or H14. Information from the company's accounting system app Products Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses H13 $700,000 $400,000 $220,000 $180,000 H14 $550,000 $220,000 $180,000 $420,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that 20% of the fixed m selling and administrative expenses are avoidable if product H13 is discontinued. The investigation also shows that one-third of the fixed manufacturing exper administrative expenses are avoidable if product H14 is discontinued. Required: a. What is the net operating income earned by product H13 according to the company's accounting system? b. What is the net operating income earned by product H14 according to the company's accounting system? c. What is the financial advantage (disadvantage) of dropping product H13? Should the product H13 be dropped? d. What is the financial advantage (disadvantage) of dropping product H14? Should the product H14 be dropped? For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). B I U S Paragraph Arial 10pt V A TE Question 1 Manama Company has two products H13 and H14. The company is considering to drop products H13 or H14. Information from the company's accounting system app Products Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses H13 $700,000 $400,000 $220,000 $180,000 H14 $550,000 $220,000 $180,000 $420,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that 20% of the fixed m selling and administrative expenses are avoidable if product H13 is discontinued. The investigation also shows that one-third of the fixed manufacturing exper administrative expenses are avoidable if product H14 is discontinued. Required: a. What is the net operating income earned by product H13 according to the company's accounting system? b. What is the net operating income earned by product H14 according to the company's accounting system? c. What is the financial advantage (disadvantage) of dropping product H13? Should the product H13 be dropped? d. What is the financial advantage (disadvantage) of dropping product H14? Should the product H14 be dropped? For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). B I U S Paragraph Arial 10pt V A TE