Sunland 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: A B Total Sales $2,289,000 $1,405,000 $1,801,500 $5,495,500 Variable expenses 1,692,000 601,400 1,099,000 3,392,400 Contribution margin $597,000 $803,600 $702,500 $2,103,100 Advertising expense $527,000 $428,000 $522,000 $1,477,000 Depreciation expense 15,100 10,700 21,900 47,700 Corporate expenses 93,400 80,100 106,000 279,500 Total fixed expenses $635,500 $518,800 $649,900 $1,804,200 Operating income $(38,500) $284,800 $52,600 $298,900 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. Restate the income statement in segment margin format. A B $ $ $ $ $ $ (b). What would be the effect on income if product A were dropped? Net income would by $ e Textbook 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