Sandhill Toys management is considering eliminating product A, which has been showing a loss for several years. The company's annual income statement, is as follows: B Total $2,221,000 $1,402.000 $ 1,819,600 $5,442,600 Sales Variable expenses 1,668,000 601,300 1,083,800 3,353,100 $ 553,000 $ 800,700 $735,800 $2,089,500 Contribution margin Advertising expense Depreciation expense $ 514,000 $427,000 $ 522,000 $1,463,000 15,300 10,600 20.100 46,000 Corporate expenses 94,700 84,400 105,900 285,000 Total fixed expenses $ 624,000 $ 522,000 $ 648,000 $ 1.794.000 Operating income $(71,000) $ 278,700 $ 87,800 $295,500 Advertising expense - Specific to each product. Depreciation expense - Specific to each product; no other use available, no resale value. Corporate expenses - Allocated based on number of employees. A B $ $ $ Advertising Common fixed expenses Contribution margin Depreciation Direct fixed expenses Operating profit Sales Revenue Segment margin Variable expenses ito two components: a variable overhead spending variance What would be the effect on income if product A were dropped? Net income would by $ eTextbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (c) Management is considering making a new product using product A's equipment. If the new product's selling price per unit were $ 10, its variable costs were $5, and its advertising costs were the same as for product A, how many units of the new product would the company have to sell to make the switch from product A to the new product worthwhile? Units