Sales revenue Variable costs Contribution margin Less: Direct Fixed costs Segment margin Less: Common fixed costs* Net operating income (loss) Segmented Income Statement for MSI's Toddle Town Tours Product Lines Pet Store Parade $ 65,000 29,000 $ 36,000 5,400 $ 30,600 13,000 Grocery Getaway $ 60,000 25,000 $ 35,000 4,000 $ 31,000 12,000 Post Office Polka $ 22,000 14,000 $ 8,000 4,200 $ 3,800 4,400 $ 17,600 $ 19,000 $ (-600) Total $ 147,000 68,000 $ 79,000 13,600 $ 65,400 29,400 $ 36,000 *Allocated based on total sales revenue. MSI has determined that elimination of the Post Office Polka (POP) program would not impact sales of the other two items. The remaining fixed overhead currently allocated to the POP product would be redistributed to the remaining two products. Required: 1. Calculate the incremental effect on profit if the POP product is eliminated. 2. Should MSI drop the POP product? 3-a. Calculate the incremental effect on profit if the POP product is eliminated. Suppose that $4,000 of the common fixed costs co be avoided if the POP product line were eliminated. 3-b. Should MSI drop the POP product? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3A Required 3B Calculate the incremental effect on profit if the POP product is eliminated. Suppose that $4,000 of the common fixed costs could be avoided if the POP product line were eliminated. Effect on Profit $3,400 Increase