Required information [The following information applies to the questions displayed below. ] A company produces two products. Productl sells for $155 and Product 2 sells for $115. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 110,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Product 1 Proguct Direct materials $ 24 $ 12 Direct labor 23 26 Variable manufacturing overhead 22 12 Traceable fixed manufacturing overhead 23 25 Variable selling expenses 19 15 Common fixed expenses 22 17 Total cost per unit $133 $107 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Consider each of the following questions separately. 3. Assume the company normally produces and sells 97,000 unit of Product 2 per year. What is the financial advantage (disadvantage) of discontinuing Product 2? ' 6 Answer is complete but not entirely correct. ' Financial (disadvantage) a $2 296 000) 0