Rockets Corporation has a product line, Rookie, that is struggling to make a profit. They are considering stopping production of this product and using the freed up capacity to work on an upgrade for a different product line, All Star. Information related to Rookie follows:

Commited fixed costs	$72,000
Discretionary fixed costs	$26,000
Unit sales	7,000
Unit selling price	$43
Direct materials per unit	$17
Direct labor per unit	$18

The upgrade for the other product line would bring in additional revenues of $58,000 and require a new material to be purchased for $16,000. What is the incremental profit (loss) associated with stopping production on Rookie (incremental losses are indicated by a negative (-) sign)?

Multiple Choice

• -30,000

• 12,000

• 42,000

• 56,000

• 84,000