Question 6 IOP company is thinking about dropping product X. The following is related data: Sales $600,000 Variable expenses $241,000 Fixed manufacturing expenses $232,000 Fixed selling and administrative expenses $180,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $192,500 of the fixed manufacturing expenses and $107,500 of the fixed selling and administrative expenses are avoidable if product X is discontinued. Required: 1. What is the net operating income earned by product X ? Show your calculations. 2. What would be the financial advantage or disadvantage of dropping product X ? Should the product be dropped? Show your analysis