Question 3 of 8 - / 15 IE View Policies Current Attempt in Progress Penny Worth Village sells home, and office furniture. Currently the home product line takes up approximately 50 percent of the company's retail floor space. The president of Penny Worth Village is trying to decide whether the company should continue offering office furniture or concentrate on home furniture. Below is a product line income statement for the company. If office furniture is dropped, salaries and other direct fixed costs can be avoided. In addition, sales of home furniture can increase by 15 percent without affecting direct fixed costs. Allocated fixed costs are assigned based on relative sales. Home Office Furniture Furniture Total Sales $1,400,000 $1,078,000 $2,478,000 Less cost of goods sold 910,000 784,000 1,694,000 Contribution margin 490,000 294,000 784,000 Less direct fixed costs: Salaries 171,500 171,500 343,000 Other 53,900 53,900 107,800 Less allocated fixed costs: Rent 14,020 10,734 24,754 Insurance 3,160 2,567 5,727 Cleaning 4,120 3,239 7,359 President's salary 70,540 55,692 126,232 Other 7,170 4,953 12,123 Net income / (loss) $165,590 $(8,585) $157,005 Determine whether Penny Worth Village should discontinue the office furniture line and the financial benefit (cost) of dropping it. (Round answer to O decimal places, e.g. 5,275.) Net income without Office Furniture is $ The company the Home Office Furniture | should drop should not drop