rofits have been decreasing for several years at Pegasus Aitlines. In an effort to improve the company's performance, the company is hinking about dropping several flights that appear to be unprofitable. A typical income statement for one round-trip of one such fight (fight 482 ) is as follows: The following odditional information is available about fight 482 : a. Members of the flight crew are poid fixed annual salaries, whereas the fight assistants are paid bosed on the number of round trips they complete. b. One-third of the liability insurance is a special charge assessed against fight 482 because in the opinion of the insurance company. the destination of the flight is in a "high-risk" area. The remaining two-thirds would be unaffected by a decision to drop fight 482. c. The baggage loading and flight preparation expense is an allocation of ground crews' salaries and depreciation of ground equipment. Dropping fight 482 would have no effect on the company's total baggage loading and flight preparation expenses. d. If fight 482 is dropped, Pegasus Airlines has no authorization at present to replace it with another flight. e. Aircraft depreciation is due entirely to obsolescence. Depreciation due to wear and tear is negligible 1. Dropping flight 482 would not allow Pegasus Aitines to reduce the number of airciaf in its fleet or the number of flight crew on its payroll